BUILD hails corporate tax cut
It expresses concern over revenue target
The announced budget 2015-16 has got some positive elements, but at the same time there are some issues which may hamper growth, Business Initiative Leading Development (BUILD) said.
Public limited tax reduction at the rate of 2.5 per cent is a good decision, withdrawal of upfront tax at source on treasury bond at the rate of 5 per cent, reduced rate of capital machinery and higher import tax slabs, reduction of VAT for RMG Sector compliance related items are good decisions and some positive steps, says a BUILD press release.
But the private sector is a bit alarmed because of ambitious revenue target which will discourage them. Increase in tax for transformers is not welcome because industries require it for power source.
Overall the budget is in line with the visions of the government, however more incentives for private sector could have been welcome, the statement said.
Export growth was 2.6 per cent against import growth of 12.3 per cent, Finance Minister AMA Muhith expects that this increase will help to produce more industrial production in future.
The institutional mechanism should be strong to channelise import Growth for real Industrialisation.
GDP growth target 7 per cent is an achievable target, but political stability and increase in private sector investment is a must to achieve it. Increase in public sector investment is noticeable, but private sector investment has not responded accordingly.
Establishment of economic zones is one of the positive intentions of government for increasing investment. It was also announced that special SEZ will be earmarked for Japan and Korea is encouraging as well, but from the previous experience country specific zones it is not that much comfortable for the private sector. SEZ act 2014 is still in the process which needs to be finalised soon, the statement addded.
Several skill development programmes have been initiated through the budget proposals but the quality of education is not yet up to the mark, industrial entrepreneurs are always demanding for quality worker for their different non-traditional sectors as they are required to hire high priced foreign workers, the business initiative said.
