Talk over tax hike on bank accounts ‘useless’, says Muhith

It really is nothing new - this is the finance minister's response to critiques who want him to roll back a planned hike of excise duty on bank accounts.

"This is useless talk. This is nothing new. We just raised the limit and a bit of the rate too," said AMA Muhith in reply to questions posed by reporters during a discussion in Dhaka. 

The finance minister's decision to tax bank accounts with more than Tk 100,000 in deposit  has gathered flak from businesspersons and economists alike.

A bank account with debit or credit over Tk 100,000 but below Tk 1 million will be charged Tk 800 instead of Tk 500 from the 2017-18 fiscal year.

Bank accounts that have between Tk 1 million and Tk 10 million will be charged Tk 2,500 instead of Tk 1,500.

Accounts that have deposits between Tk 10 million and Tk 50 million will be charged Tk 12,000 instead of Tk 7,500.

The excise duty on accounts holding over Tk 50 million will be raised from Tk 15,000 to Tk 25,000.

The move did not seem rational to regular citizens or experts who believed it would push people towards illegal methods of transaction. In parliament, both ruling and opposition MPs have called for its withdrawal from budget plans.

But Muhith, speaking at a press conference on the day after presenting the budget, had said people with Tk 100,000 in their bank accounts were wealthy people who could afford to pay the tax. 

But Prime Minister Sheikh Hasina on Sunday said the government would fix any error in the proposed budget.

Muhith said the claim by the Centre for Policy Dialogue that the budget had statistical flaws was 'rubbish'.