The actual tax has not come down24 June 2021
Mustafa Alim Aolad, FCA (UK):
I have been associated with the healthcare sector for the last 7 months. Corporate tax has been reduced for two consecutive years. But the amount of actual tax has not come down but has increased, said Mustafa Alim Aolad, FCA (UK), CFO, Evercare Hospitals Ltd
He spoke at a virtual roundtable meeting (June 12) of The Association of Chartered Certified Accountants (ACCA) in Bangladesh on the government's proposed budget for the fiscal year 2021-22.
He said, It has also had an impact on our sector. Investment in health care outside the big city has been exempted from tax for 10 years. This is very good news. According to the World Health Organization, there must be 10 doctors and 25 nurses per 10,000 people. There are 5 doctors and 4 nurses against 10,000 people in our country. 70% of the country's doctors are in big cities like Dhaka and Chittagong. However, 70% of the country's population lives outside the city.
He said,That is why this tax exemption of the budget is a very correct decision. But to implement it, it is not only necessary to increase the investment benefits, but also structural changes where these doctors and nurses are. Putting money behind a building and medical equipment will only be a waste unless we can attract human resources to manage them.
He said, We have opened a new hospital in Chattogram. We know how much money it costs. It takes 3 to 4 years to build a hospital. 3-4 years from 10 years tax exemption is lost here. From the first day of the launch of a hospital, all the equipment and doctors, nurses and other human resources have to be available. Our new hospital has 400-500 employees, while we are getting 100 patients every day. We have to be at a loss for the first 4-5 years. All in all, 10 years of tax exemption are over before we can see the face of profit. The healthcare sector will be able to attract investors if tax exemption periods like some other industries are extended or low tax rates are applied. Moreover, if customs duty is waived in medical equipment imports instead of this tax exemption, the hospital will cost about 15% less money.
ACCA Bangladesh and experts from various sectors including Arif Al Islam, MD and CEO, Summit Communications, Mamun Rashid, Managing Partner, PWC Bangladesh and Masud Khan, Chairman, Unilever Consumer Care Limited shared their insights.
From ACCA Bangladesh, Shah Waliul Manzoor, Senior Business Development Manager (Learning), Abdullah Al Hasan, Marketing Manager, GM Rashed, Business Services and Compliance Manager and Syeda Sadia Afroze were present. The event was moderated by Prawma Tapashi Khan, ACCA, Head of Education, ACCA Bangladesh, in partnership with ACE Advisory and TaxHouse Bangladesh Limited.
Writer: Chief Financial Officer, Evercare Hospitals Limited, Dhaka.