Impose income tax on tech giants: ICAB

The Institute of Chartered Accountants of Bangladesh (ICAB) yesterday proposed imposing a "digital service tax" or an income tax on global technology companies offering digital services in Bangladesh. 

Bangladesh currently imposes value added tax (VAT) on digital advertisement, including those put on social networking sites Facebook and YouTube.

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The proposal was placed at a pre-budget meeting organised by the National Board of Revenue (NBR) at its headquarters in the capital's Agargaon and afterwards at a press conference on the ICAB premises in the capital.

The NBR has taken a number of initiatives to digitalise some processes such as return submissions but the processes are not comprehensive, said ICAB Member Snehasish Barua.

"We recommend a comprehensive, integrated, end to end digitalisation process so that hassles faced by taxpayers is minimised," he said.

Many governments try to avoid incurring high expenditures in tax collection and the Bangladesh government has to do the same while increasing tax revenue, said the ICAB.

In order to reduce cost of production and harassment faced by taxpayers, advance tax should be waived on raw materials or equipment used by companies registered for value added tax or VAT as manufacturers or service providers, said the ICAB.

It recommended amending The Customs Act, 1969 to facilitate export diversification.

"We can determine the duty correctly by following the correct procedures of the tariff act and following the currency exchange rate," said Md Moniruzzaman, president of the ICAB.