"Continuation of tariff protection not only affects the national budget badly but also poses a negative impact on the local industries comprehensively," AB Mirza Azizul Islam told a post-budget discussion organised by the Federation of Bangladesh Chamber of Commerce and Industries (FBCCI).

The adviser said providing tariff protection for the local industries means that these are not competitive with international market. Moreover, with the tariff protection, the industries could not be converted to export-oriented ones, he added, citing an example that the countries like Thailand, Korea and Malaysia offered low duty and subsidy to their industries once, but now they cut down the facilities.

In the meeting, the adviser drew the business leaders' to the price spiral of essentials and raised a question about how prices of those soared even after lifting duties from some items.

"Why does the BDR (Bangladesh Riffles) interrupt in the market to control the price hike?" he questioned, urging the business leaders to check who are involved with such a price hike.

The adviser said there should not be any provision for giving tariff benefits through issuing Statutory Regulatory Order (SRO) after the budget is passed.

"Unfortunately, there is a tendency of giving duty benefits to the local industries through SRO, which increases ambiguity in the duty and customs policy. We have to come out of this tradition and enter into a strict duty and customs line," he opined.

On trade liberalisation, Mirza Aziz said any analysis finds it that economic growth has been accelerated for this. "Indian economic growth was three to 3.5 percent up to 1990 and the growth accelerated when Manmohon Sing liberalised their trade in 1991," he pointed out.

Talking about the tax-GDP ratio, he said the tax net has been widened in the proposed budget considering this ratio one of the lowest in the world.

"It is a common phenomenon that nobody wants to pay taxes. But two things are universal, one is 'tax' and another is 'death' and everybody should realise the truth," he said.

Commenting on rehabilitation of sick industries, Mirza Aziz said jute sector is his first priority. "However, we will conduct a survey to ascertain how far it is viable to rehabilitate all the sick industries and in what way the job should be done," he said, adding that it is impossible to run the industries providing subsidy.

"Lastly, I can say that we have to consider the interests of finished product importers, local manufacturers and customers," he said.

Later, the business leaders reiterated their call to the government to give a second thought on the proposed duties on raw materials and intermediate materials. They also advocated keeping intact the current duty structure in the next fiscal year's budget.

They said in the current budget the average incidence of 121 raw materials is 13.82 percent and in the next year the average incidence would be 21.77 percent, showing an increase of 7.94 percentage points.

Besides, they said, the average incidence of 291 raw materials is 21.81 percent in the current fiscal and the average incidence will be 25.99 percent in the next fiscal, thereby showing an increase of 4.18 percentage points.

They said supplementary duty reduction on around 219 goods from existing 25 percent to 20 percent would cast negative impact on agro-processing, electric lamp and light fittings, accumulator battery, footwear and cosmetics, float glass, ceramic, and sanitary and bathroom fittings industry.

Besides, the impact on bread and biscuit, soft drinks and candy industry would be negative due to supplementary duty cut on around 13 items from existing 65 percent to 60 percent in the proposed budget, they added.

"The enhancement of the duties on capital machinery or raw materials and reduction of duties on finished items will ultimately impact the local industry adversely," said FBCCI President Mir Nasir Hossain in his welcome speech.

UNB adds: Chairman of National Board of Revenue Badiur Rahman categorically said that the deadline for tax amnesty to legalise undisclosed money would not be extended beyond July 31.

He made it clear at the meeting that the revenue officials would not ask a single question when the taxpayers would come up to avail of the opportunity to legalise their undisclosed money. “You'll be treated as innocent as a baby within July 31,” he said, assuring the taxpayers that they would not be harassed in any way.