Spl increment for lower tier employees needed

Staff Reporter :
A special increment is needed to the lower tier employees both in private and public institutions as the Prices of essentials are rising sharply and going beyond the people’s reach, said Centre for Policy Dialogue (CPD).
The price hike is due to partly domestic reasons, including market distortion by a small number of dominant firms and lax regulations, the private think tank said at an event on “CPD’s Recommendations for the National Budget FY2023-24,” at its head office in the city on Monday.
It also said, “Food consumption cost of a family increased by 25 per cent in a year due to the price hike of essentials and a typical middle-class household spends 60 per cent of its total income on food”.
Salaries should be increased by 5 per cent in the private sectors to deal with the inflation pressure, it said.
The government should stop the opportunity of returning laundered money by paying 7 per cent tax in the next budget, it said, citing, “It is unacceptable as the opportunity will discourage the regular tax payers”.
The CPD also recommended stopping the opportunity of whitening black money and forming a “Bank Commission” to bring reform in banking sector.Criticizing the government for increasing pressure on consumers by enhancing the prices of electricity and energy to reduce subsidy, the CPD said, “Electricity prices should be left to the market and reviewed once every month. It is necessary to abolish the system of capacity charge of power plants and go for no electricity, no payment system”.
There are a number of essentials such as rice, sugar, soybean oil and beef that are more expensive in Bangladesh than in other developing or industrialised countries, said Fahmida Khatun, Executive Director of the CPD.  
“The issues like high prices of daily commodities, negative trend in revenue collection, slowness in development projects, liquidity and dollar crisis in banks, imbalance in financial sector and reduction of reserves, have to be taken into consideration in preparing the next budget,” she said.
“Good governance and discipline must have to be brought in monetary and revenue policies. Political will is important for this,” she added.
She further said, “Many families, including minimum wage earners across all sectors, are struggling to afford them. So, many of them are excluding meat and fish from their menus”.
International comparison of prices shows that the prices of essential food items don’t fall in Bangladesh even when the international prices decline. Moreover, the prices of some food items have remained consistently higher than those in the global markets, according to Fahmida.
At least 28 imported essential food items currently face a high incidence of tax, she observed.
“In the backdrop of the soaring inflation, the National Board of Revenue (NBR) should reduce the duties and taxes both at import and domestic levels in order to provide some respite to consumers with low and limited incomes,” she said.
The CPD also proposed introducing an excise duty of Tk10 on each stick of cigarettes and urged to eliminate the tiers of cigarette taxation and replacing those with a single universal system.
The specific excise duty, which is fixed per stick or per pack, could be implemented instead of an ad valorem tax. Currently, the government charges Health Development Surcharge, supplementary duty and VAT on tobacco products. Cigarettes are also taxed according to four tiers – Low, Medium, High and Premium.
Apart from cigarettes, the CPD has proposed a specific excise duty Tk3 on per stick of bidi and Tk6 on per gramme of Jarda and Gul, the CPD said.
Besides, the think-tank proposed increasing the Health Development Surcharge from 1 per cent to 5 per cent.
The CPD proposed the corporate tax on all companies manufacturing tobacco products to be increased from 45 per cent to 50 per cent in FY24
For soft drinks and energy drinks, the CPD has recommended a specific excise duty of Tk0.10 per ml or Tk100 per litre.
CPD Research Director Khondaker Golam Moazzem and Senior Research Fellow Towfiqul Islam Khan also spoke at the event.