The proposed budget does not reflect the ICT sector's demands although they are aimed at accelerating the development of the industry, said the Bangladesh Association of Software and Information Services (BASIS) yesterday.
It said it had proposed extending the exemption of corporate tax to businesses related to software development and information technology-enabled services (ITESs) from 2024 to 2030, but this has not been considered in the budget.
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The BASIS also suggested allocating at least 10 per cent of the budget for the internal development of all ministries and their affiliated agencies, particularly the purchase of software and ITES.
The BASIS suggested allocating at least 10 per cent of the budget for the internal development of all ministries and their affiliated agencies, particularly the purchase of software and ITES. But it said it did not see any specific guidelines in this year's budget.
"But we did not see any specific guidelines in this year's budget," it said.
"The budget for the IT sector did not reflect our proposals," said Abu Daud Khan, a vice-president of the association.
He thanked the finance minister for increasing the budget allocation for the ICT sector by 16.69 per cent, or about Tk 274 crore, to Tk 917 crore compared to the revised budget.
"However, there was no clear indication as to which projects or sectors the money would be spent and how it would benefit the ICT industry and its entrepreneurs."
Khan also applauded the proposal that exempts start-ups from all types of reporting obligations, except the filing of income tax returns.
The BASIS said it proposed creating a fund of at least Tk 300 crore to provide loans to women entrepreneurs at a 2 per cent interest rate to increase their participation in the ICT sector.
It also sought incentives equivalent to 10 per cent of the monthly salary of female officers or employees working at software and ICT companies to give a boost to women's employment.
However, the proposed budget did not consider the proposals, said the association.
The trade body said the budget also did not reflect its demand for the inclusion of the platform as a service (PaaS) and the software as a service (SaaS) in the definition of ITES.
The PaaS is a cloud computing model where third-party providers deliver hardware and software tools to users, while SaaS platforms make software available to users, both over the internet.
But the demands were not taken into account, the BASIS said.
"We noticed that many schemes have been taken up by the government in many sectors from time to time to compensate for business losses owing to the coronavirus pandemic. So, we proposed to take up a Tk 2,000 crore stimulus package for the ICT sector at 5 per cent government-subsidised interest rate, but we did not see that in the budget outline either."
The organisation went on to say that the budget proposed to impose a 15 per cent value-added tax (VAT) on the imports of essential equipment used in the ICT sector, especially laptops and printers.
"This will increase the cost for both traders and consumers."
There should be a plan to multiply the production of laptops locally by building an ecosystem for making it faster. Otherwise, the price of imported laptops may go past the purchasing power of freelancers, it added.
Fahim Ahmed, a vice-president of the BASIS, said he hoped the government would reconsider the issues.