Muhith hints at revising down excise duty on bank deposits

After State Minister for Finance MA Mannan's assurance in parliament over the proposed excise duty on bank deposits, Finance Minister AMA Muhith hinted at revising it down.

"There are concerns over increasing the rate. If anything changes, it would be the rate of duty, that's all," Muhith told reporters on Wednesday after emerging from a cabinet committee meeting.

The budget for FY2018 proposes to increase excise duty to Tk 800 from Tk 500 on accounts with balance of Tk 100,000 or more, which drew sharp criticism from several quarters, including trade bodies and economists.

Bank accounts with balance 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 to Tk 25,000 from Tk 15,000 now.

Traders, bankers and economists apprehend that the decision might inspire people to opt for illegal ways of money transactions.

Several MPs, both from the ruling party and the opposition, have already called on the finance minister to reverse his decision.

The government will find ways to revise it down, State Minister Mannan said in parliament on Tuesday.

"I believe we will be able to reach an acceptable solution. We assure that the government high-ups are looking into the matter.”

Mannan further said the government and the finance minister are not removed from society, so the issue will be discussed again.

Referring to Mannan's statement, Muhith said on Wednesday: "The state minister has said that. He is not an irresponsible person."

Excise duty on bank deposits is 'nothing new', he said. “A final decision will come after discussion in parliament.”

"Now it's being said the rate (of the excise duty) is too high. But it seemed from the criticisms at the beginning that it has been introduced for the first time."