More tax likely on luxuries

May 27, 2009

A rise in tax on luxury items, including cars and cigarettes, would be proposed in the next national budget, to up the public expenditure for the poor section of the society, the finance minister hinted yesterday. “Duties on luxury items and goods harmful to health are likely to be increased,” AMA Muhith told reporters after a meeting with Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) at his ministry. However, the minister did not specify the luxury items that would face higher taxes.

Muhith said, “Awami League is a party of the poor. So there will be tax on luxury items, as we will have to collect huge revenue to meet their demand. Besides, tax collection can be raised through tax net expansion.”

This time the number of tax payers will be raised to 10 lakh from 7 lakh, the minister added.

On the recent import of huge cars, he said it happens ahead of budget every year and this time is no exception.

Admitting to the possible enhanced overseas assistance for the 2009-10 fiscal year budget, Muhith hoped that around 3 percent of the 5 percent deficit budget would come from donors.

Earlier, during Muhith’s meeting with World Bank Executive Director for South Asia Pulok Chatterji, the bank’s new programme to help different countries to cope up with the ongoing global financial meltdown figured high.

The finance minister also discussed the World Bank’s increasing contribution to Bangladesh’s social safety net programme.

More tax likely on luxuries

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