Information technology sector leaders on Sunday expressed their concerns over some provisions in the proposed budget for the 2024-25 financial year, saying that the removal of tax exemptions for cloud services and IT process outsourcing could hamper the sector鈥檚 journey toward achieving self-reliance.
At a post-budget joint press conference held at the BASIS auditorium in the capital Dhaka, leaders of Bangladesh Association of Software and Information Services, Bangladesh Association of Contact Centre and Outsourcing, Internet Service Provider Association of Bangladesh and E-Commerce Association of Bangladesh sought policy support from the government to achieve self-reliance in this sector.
Finance minister Abul Hassan Mahmood Ali placed the proposed budget for the 2024-25 financial year before Jatiya Sangsad in the capital Dhaka on June 6.
BASIS president Russell T Ahmed urged the government to keep cloud services and web hosting tax-free to support the growth of local ICT service companies.
He also called for the reconsideration of the imposition of a 1-per cent import duty on capital equipment for high-tech park investors, urging the government to maintain the current duty-free status.
Russell thanked prime minister Sheikh Hasina for extending the tax exemption for the ICT sector for three years.
BACCO president Wahid Sharif criticised the proposal to increase supplementary duty on mobile SIM card usage by 5 per cent.
He also expressed concern over the removal of tax exemptions from sectors like cloud services, IT process outsourcing, medical transcription, search engine optimisation, system integration and NTTN services, saying that the initiative could negatively impact the ICT industry.
ISPAB president Md Emdadul Hoque said that despite directives from the prime minister to enhance the ICT service sector, the failure of the proposed budget to include all ISP services under the IT-enabled services category, coupled with a 10-per cent advance income tax on broadband internet service providers and a 37-per cent VAT and duty on optical network unit and optical line terminal equipment, posed significant challenges.
He said that these measures would hinder the expansion of internet services and the transition from digital Bangladesh to smart Bangladesh.
Syeda Ambareen Reza, vice-president of E-CAB, said that in the implementation of Smart Bangladesh, the existing VAT in the logistics sector should be withdrawn to level the playing field between online and conventional store products.
She demanded a minimum 2-per cent cash incentive equivalent to payment charges to encourage digital payments, opposing the inclusion of payment gateway charges in the non-tax deducted at source list.
