The government is preparing to bring small businesses under a single VAT rate as part of efforts to widen the tax net, Finance and Planning Minister Amir Khosru Mahmud Chowdhury said on Sunday.
He also warned that Bangladesh's energy crisis could take at least two years to resolve.
He said the government was preparing a database for introducing the system and that it could be rolled out at any time.
"The initiative is being taken to expand the tax net. The VAT rate will be within everyone's reach," he said.
The minister made the remarks at a seminar organised by the American Chamber of Commerce in Bangladesh (AmCham) at a local hotel, where business leaders raised concerns over policy, taxation, energy and investment.
AmCham President Syed Mohammad Kamal chaired the event.
The minister also said Bangladesh's ongoing gas and electricity crisis would take at least two years to resolve.
"The problems with gas and electricity will not be resolved in six months or a year. It will take at least two years," he said.
He said setting up a floating LNG terminal alone would take around 1.5 to two years, making an immediate solution to the crisis unlikely.
"An economy cannot move forward without gas and electricity," Mr Khosru said.
The government was taking steps to address the energy shortage, including resuming gas exploration and developing solar and coal-based power, he said.
"We are determining how much energy we will need and from which sources. The energy policy will be published within the next few weeks, so people will know what needs to be done," he said.
"We have to remain cautious for the next two years," he added.
On revenue mobilisation, Mr Khosru said Bangladesh's tax-to-GDP ratio remained very low and the government was working to broaden the revenue base.
"The implementation and policy functions will be separated," he said, adding that the authorities would examine whether companies were paying taxes in line with their market share in different product categories.
He said the tax administration was also being modernised to improve transparency.
"The port and customs authorities blame each other. I have sat with them together. A specific timeframe will be set for everything," he said.
On the capital market, the minister said he had received warning signals about the stock market and that steps had subsequently been taken.
"We need more listed companies," he said, urging businesses to list on the stock market to lower financing costs instead of relying on high-interest bank loans.
"Why would you take loans from banks at high interest rates? Get listed and reduce your cost of doing business," he told businesspeople.
On the banking sector, Mr Khosru said the industry was facing a severe capital shortage that was too large for the government to address alone.
"Depositors are not getting their money back. The amount of non-performing loans is very high. So, we need alternative sources of financing," he said.
Transcom Group CEO Simeen Rahman said that although the advance income tax rate had been reduced from 5 per cent to 4 per cent, revenue officials were still deducting tax at the higher rate.
In response, the finance minister said the pharmaceutical sector would also be included and assured her that the advance income tax issue would be examined.
She also raised concerns over additional charges for utility services in economic zones.
In his concluding remarks, AmCham President Syed Mohammad Kamal said businesses wanted to be part of the solution rather than merely identify challenges.
"We do not want to only identify challenges; we want to be part of the solution," he said, adding that more such initiatives would be organised in the future.
FBCCI Administrator Md Fazlul Hoque, former FBCCI president Mir Nasir Hossain and other business leaders also spoke at the event.
