FBCCI to government: Withdraw your deposits if banks fail to provide stimulus loans

‘This is a humanitarian, societal, and economic budget to turn the economy around after Covid-19’

President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), Sheikh Fazle Fahim, on Saturday sought the withdrawal of government deposits from banks, if they (banks) do not cooperate with entrepreneurs in implementing the government’s stimulus package.

The federation president also said the proposed national budget for FY21 was “a humanitarian, societal, and economic budget to turn the economy around after Covid-19.”

The country’s apex trade body chief said this addressing an official, virtual post-budget press conference at their Federation Bhaban in Motijheel of the capital.

Fahim said: “While many banks have come forward to allocating funds from the stimulus package, there is reluctance among some banks. We propose that the government withdraw deposits from those banks that will not cooperate in the implementation of the package.”

“Banks which are cooperating to implement the stimulus package should be entitled to tax benefits and government deposits can also be increased for those banks,” he said.

He said the FBCCI was taking steps to facilitate funds from the government’s stimulus packages to businesspeople, to stand beside them amid the Covid-19 pandemic.

“We pledged not to back willful defaulters and financial scammers from availing stimulus loans,” he recalled.

Earlier, the government allotted some Tk1,03,117 crore under 19 packages, which was 3.7% of the GDP to fight the economic fallout due to the coronavirus pandemic.

Small entrepreneurs are receiving negligible support from banks in obtaining loans from the government’s Tk20,000 crore stimulus package, Fahim complained.

On June 11, Finance Minister AHM Mustafa Kamal tabled a national budget of Tk5,68,000 crore in parliament for the 2020-21 financial year.

The revenue target for the coming fiscal year is Tk3,78,000 crore. Of that amount, the NBR has been tasked to realize revenue of Tk,330,000 crore. The non-NBR revenue target is Tk15,000 crore, and the non-tax revenue collection target is Tk33,000 crore.

Fahim said the advance income tax (AIT) rate for traders should be revised down to 3% from 5% , while advance tax (AT) should be withdrawn on industrial raw materials for the next three years.

“Rebatable VAT needs to be revised down to 10% from 15%, and several other non-rebatable value added tax (VAT) rates that add inflationary pressure on customers should be revised downwards as well,” he said.

Fahim said: “We are cooperating with the country’s SMEs who have no connection with banks so they can avail this incentive. We want to connect unbanked traders with banks.”

“Let the real traders of the country benefit from this incentive package. If anyone has any problems with availing the incentives, please contact the staff at our chamber. We will talk to Bangladesh Bank and senior government officials about these issues,” he added.

Fahim also called for an easy access mechanism to bank credit so that all affected businesses can avail funds from the stimulus package.

The FBCCI president also favoured investing undisclosed money in manufacturing industries amid the Covid-19 pandemic, while also calling for the easing of VAT laws.

He also claimed that the some government officials and consultants took money from the government, who did not ensure an integrated and automated tax system. He demanded that the authorities carry out an investigation against them.

State-owned autonomous organizations such as Bangladesh Petroleum Corporation (BPC), Petrobangla, Dhaka Power Distribution Authority and others usually deposit their surplus, or idle money, in commercial banks as a measures to keep the banks healthy.Report:Dhakatribune.