Raise direct tax, withdraw VAT on essentials: Rights activists

Rights activists at a rally on Wednesday demanded withdrawal of value added tax (VAT) on essentials and increasing direct tax in the budget for fiscal 2012-13.

They said the government is going to impose VAT on many essentials in the next budget, which will be repressive for the poor as at present about 70 percent of the country’s revenue come from indirect tax while the direct tax (personal and corporate taxes) are the major source of government revenue in the developed countries and in many neighbouring countries.

EquityBD, a rights group, organised the rally and a human chair in front of the National Press Club in the city.

Moderated by Mostafa Kamal Akanda of EquityBD, the rally was addressed, among others, by Prodip K Roy of Online Knowledge Society, Subal Sarkar of Bhumihin Samity, Mohiuddin Hawlader of Bangladesh Krishak Federation (BKF), Syed Aminul Hoque of EquityBD and Mahabub Hossen of CDP.

The speakers said only 8 million people in the country, a mere five percent of the population, most of whom live in capital Dhaka, are the owners of 40 percent resources of the country, and of them, only one million people pay taxes.

They said the country has more than 22,000 people with bank accounts having more than Tk 10 million (one crore), but only around 1,000 of them pay taxes. So, there is a big scope of increasing the direct taxes.

The rights activists said that VAT on essentials will compound the sufferings of the poor.

They urged the government not to use the national budgetary measures as a tool of sole revenue collection, rather as the means of poverty eradication in the country where nearly 50 million people still live below the poverty line.

A number of civil society organisations, including Development Centre Initiatives, Eventful Bangladesh Society, Manush Manusher Jonney, Media Foundation for Trade and Development, Prodip, SDO, Sirac Bangladesh, UP Trust, Surakkha Foundation, United People’s Trust, and VOICE joined the human chain.

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