Businessmen have urged the government to reduce corporate tax on banks considering the present business situation in the country.

They also demanded measures to lower the lending rate to stimulate industrial growth.

At present, the corporate tax for banks is 42.5% and the interest rate on tern loan is as high as 16%.  

The businessmen raised the demand at the pre-budget meeting of the national consultative committee of the National Board of Revenue (NBR) at a hotel in the city yesterday.

“The corporate tax for banks needs to be lowered considering the present business situation,” said former FBCCI president AK Azad, who is also the chairman of Shahjalal Islami Bank Limited.

Azad said the lending rate should also be cut down to single digit as the existing rate, which is as high as 16%, is near to impossible to deal with. He recommended adjusting the interest rates of savings certificates with the lending rates.

“Being chair of a bank, I believe 9% lending rate against 6% deposit rate to make a 3% spread,” he added. The rate of inflation, however, remains well above the proposed deposit rate while the regulatory limit of spread is 5%.   

Golam Dastagir Gazi, an MP and director of Jamuna Bank Limited also echoed Azad for reducing the corporate tax.

FBCCI President Kazi Akram Uddin Ahmed said the taxes on bank and energy sectors should be rationalised as they dictate other sectors.

On a similar note, Abdus Salam Murshedy, President of Exporters’ Association of Bangladesh, asked the central bank to extend time for announcing loan as substandard to six months, instead of existing two months, taking the current situation into account.