The proposed budget does not reflect the demands of the ICT sector although they are aimed at accelerating the development of the industry, the Bangladesh Association of Software and Information Services (BASIS) said yesterday.

He said he had proposed extending the corporate tax exemption to businesses related to software development and information technology-enabled services (ITES) from 2024 to 2030, but this did not was not taken into account in the budget.

BASIS also suggested allocating at least 10 percent of the budget to the internal development of all ministries and their affiliated agencies, in particular to the purchase of software and ITES.

BASIS suggested allocating at least 10 percent of the budget to the internal development of all ministries and their affiliated agencies, especially the purchase of software and ITES. But he said he saw no specific direction in this year’s budget.

“But we haven’t seen any specific direction in this year’s budget,” he said.

“The budget for the IT sector did not reflect our proposals,” said Abu Daud Khan, vice president of the association.

He thanked the Minister of Finance for increasing the budget allocation for the ICT sector by 16.69% or about Tk 274 crore to Tk 917 crore from the revised budget.

“However, there was no clear indication as to which projects or sectors the money would be spent on and how it would benefit the ICT industry and its entrepreneurs.”

Khan also applauded the proposal which exempts start-ups from all types of reporting requirements except filing tax returns.

BASIS said it proposed to set up a fund of at least Tk 300 crore to provide loans to women entrepreneurs at an interest rate of 2% to increase their participation in the ICT sector.

It has also sought incentives equivalent to 10% of the monthly salary of female managers or employees working in software and ICT companies to boost female employment.

However, the draft budget did not take into account the proposals, the association said.

The trade body said the budget also did not reflect its request to include platform as a service (PaaS) and software as a service (SaaS) in the ITES definition.

PaaS is a cloud computing model in which third-party vendors provide hardware and software tools to users, while SaaS platforms make software available to users, both over the Internet.

But the requests were ignored, BASIS said.

“We have noticed that many programs have been taken over by the government in many sectors from time to time to compensate for business losses due to the coronavirus pandemic. So we have proposed to take Tk 2,000 crore stimulus package for the government subsidized 5 interest rate ICT sector, but we didn’t see that in the draft budget either.”

The organization added that the budget proposed to impose a 15% Value Added Tax (VAT) on imports of essential equipment used in the ICT sector, particularly laptops and printers.

“This will increase costs for traders and consumers.”

There should be a plan to multiply the production of laptops locally by creating an ecosystem to make it faster. Otherwise, the price of imported laptops could exceed the purchasing power of freelancers, he added.

Fahim Ahmed, vice president of BASIS, said he hoped the government would reconsider the issues.