We’ve been here before

One of the key factors that stands to greatly expedite Bangladesh’s aspirations to achieve middle income status in the near future would be continued investment in the Digital Bangladesh initiative.

While the government has undoubtedly taken the right steps to realize our digital dreams, certain measures often make it feel like two steps forward one step back.

Case in point the proposed VAT to be imposed on local industries involved in the manufacturing of mobile phones and refrigerators.

According to Finance Ministry sources, the National Board of Revenue (NBR) proposed imposing a 5% VAT on locally-manufactured mobile phones and refrigerators in the upcoming budget.

Reportedly to make the market more competitive and to achieve revenue collection tax.

While this is a good idea on paper, the reality of the situation is that our electronics industry is still at a place.

Where further taxes stand to hamper growth, given that the sector is still rather fledgling in scope.

While high taxes on the import of electronic devices makes sense, applying the same principle makes little sense.

Not only could it negatively impact our local manufacturing industry, it could also impede our continued digitalization.

Affordable, locally made electronic devices such as mobile phones can help increase internet penetration across the country.

Slapping a VAT on local devices at such a formative stage of this industry can disrupt that development.

If new users are unable to access mobile phones as a result of high prices by way of high tax rates, ensuring ICT services reach each.

Every strata of our society will become all the more difficult.

We’ve been here before.

The administration has previously mulled similar ideas, and they were ill advised then and they remain ill advised even now.

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