New in Budget Pension for private job holders as social, taxes on tech tools
Sayeed Muhammad: The government has said the government has planned to introduce a pension scheme for private sector employees in FY2018-19, said Finance Minister AMA Muhith.
If implemented, this will the first time in the history of Bangladesh that Prive job holders will enjoy the pension scheme.
Introduction of a universal pension scheme would require basic structural reforms which will take much time and entail spending a lot, he added.
His comments came in the budget speech for the fiscal year 2018-19 yesterday.
Under the proposed scheme, an employee will subscribe to a specific amount to the pension fund by registering with the government-administered pension scheme.
Currently, merely 5% of the total population working as government employees enjoy pension schemes, while 8% of the remaining 95% people are employed in the private sector and do not enjoy pension benefits.
Meanwhile, he also proposed introduction of new provisions in the tax laws over the taxation of virtual and digital sectors, such as Facebook, Google, Youtube, on their incomes earned in Bangladesh.
The minister mentioned that the volume and the nature of cross-border transactions have significantly changed with the progression of economic globalisation and virtual-plus digital economy.
“Our economy is far more open now. As a result, the risk of tax avoidance has significantly increased. Many foreign entities are earning income in Bangladesh through virtual and digital transactions, but we aren’t getting adequate tax from them,” he added.
As these virtual and digital business transactions are comparatively new, the tax laws of the country were not sufficiently up-to-date to bring all virtual transactions into tax net, Muhith stated.