The Business Initiative Leading Development (BUILD), a public private dialogue platform, on Tuesday recommended the formation of a national economic fund with allocation of approximately Tk 50,000 crore to address the adversely affected economic situation due to the coronavirus pandemic.
A special economic assistance fund can also be created under the fund for businesses from micro, small and medium enterprises (MSME) to large firms to support them to overcome the losses, it said.
The fund will extend loans with no interest and extended instalment payment facility to the sectors, the organisation said in an observation on the impact of COVID-19 and its effects on the Bangladesh economy.
The BUILD, an initiative of the Metropolitan Chamber of Commerce and Industry, Dhaka Chamber of Commerce and Industry and Chittagong Chamber of Commerce and Industry, said that there was a serious need for assessing the potential losses of all sectors and making a decision accordingly to announce stimulus packages for the sectors.
It said that the financial package of Tk 5,000 crore announced for export-oriented industries might not be enough to meet sectoral demands if the situation continued beyond the expected timeframe.
The government must also address the local industries that will need policy support as they are also deeply affected by the current economic situation, said the BUILD which is also recognised as the primary source of recommendations for meetings of the private sector development policy coordination committee of the Prime Minister’s Office.
It also said that there must be interventions targeting industries that were the worst hit by the coronavirus pandemic.
One key policy directive can be to extend loans at the lowest possible or zero interest rate to industries on condition that they would keep workers on payroll regardless of their work, it recommended.
The government should take necessary measures to reduce income tax and corporate tax rates by 5 per cent for all sectors.
The NBR should also consider postponing collection of taxes for two quarters, waiving penalties for delay in tax payment and exempting demurrage charge on import.
The government must ensure that businesses do not cut jobs due to the economic downturn and some mechanisms need to be developed to keep jobs.
It may offer tax relief at the rate of 2 per cent to firms where there is no job loss for next one year, it said.
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