The New Nation - Internet Edition

BSS, Dhaka

Tax on business entities at local levels has been identified as potential income sources for the survival of union parishads (UPs), the oldest and strongest tier of the local government bodies in the country.

An action research of RTI, a USAID-supported organisation, said the 'business tax' could help UPs to generate an amount that is sufficient to meet their annual expenses for office and staffs, now coming from the central government.

The research conducted in five UPs in Natore district between 2006-08 showed that annual income from commercial enterprises in Tebaria, Dighapatia, Baraharishpur, Walia and Majgaon shot up by 20 to 176 percent after piloting started in the areas two years ago.

"Business tax is a major potential sector for UPs to raise income from own sources to be self-reliant. But it is often ignored as the elected representatives lack of proper planning and expertise and fear of losing popularity," Dr Saiful Islam, programme coordinator of RTI, told BSS on Friday.

Saiful, however, said the assessment and collection of the business tax, which is an addition to the income tax and licence fees, was a big challenge for the UPs, who are mainly run by grants from the government with a meagre income from their own. "This way the UPs can move forward towards achieving self- reliance or independence," Saiful said, adding a UP in remote areas can earn Taka between 50,000 and 120,000 annually from business tax, which is determined on the basis of the size of the enterprises. The average annual budget for all activities of a UP ranges from Taka five to twenty lakh.