The government will provide a roadmap for the continuation of income tax exemptions for the IT sector for a couple of years before a gradual withdrawal, said Salman F Rahman, private industry and investment adviser to the prime minister.

He said he had brought Prime Minister Sheikh Hasina's attention to the income tax exemptions demanded by the IT industry and she had told him that the benefits could not be continued forever.

Rahman said he had explained that the IT industry just wanted a plan for the continuation of the income tax exemptions for three to five years before taxes are gradually imposed and the prime minister had largely agreed.

He believes the upcoming national budget will delineate how taxes will be levied over the next two to four years so that people in the industry can get an idea of how to move forward.

Rahman was speaking at a ceremony organised by the Bangladesh Association of Software and Information Services at the Radisson Blu Water Garden Hotel in Dhaka on Monday to mark its newly-elected executive council taking office.

The existing income tax exemptions for the software and information technology services sector are set to expire in June this year.

Rahman said people involved in the IT industry would have to be vocal about the kind of policy support required for the domestic sector to keep pace with global technological advancements.

"While tax exemptions are important, you have to tell us what kind of policy you need to go to the next level," he said.

"AI, blockchain and big data need to be looked at because it will be programmers who will lose jobs the most in the future. The government should be guided in this matter by the BASIS," he said.

The government plans to abolish tax benefits for various sectors to accelerate revenue collections in line with targets set by the IMF as a part of a $4.7 billion loan programme.

However, according to Russell T Ahmed, president of the BASIS, taxing the IT sector will not yield the expected benefits.

"We have noticed a number of inconsistencies in the NBR regarding tax exemptions for the IT sector," he said.

"According to them, the IT sector makes annual profit of Tk 5,000 crore and revenue of Tk 50,000 crore. But in reality, the total turnover of this sector is Tk 2,000 crore annually," he said.

"Once this anomaly is addressed, we think the International Monetary Fund (IMF) will lose interest in taxing this industry," he said.

"Given that, we are demanding the income tax exemption be continued till 2031 considering the potential of this sector," Ahmed added.

He said the IT sector would play a crucial role in the realisation of the government's vision for a "Smart Bangladesh".

"To reach this goal by achieving self-sufficiency in the local market and moving towards the $5 billion (export) target, we feel that the government should set a target of self-sufficiency in the IT sector by 2041 through a policy," he said.

Ahmed added that public and private IT project purchases should be made from Bangladeshi tech companies, not foreign ones, taking into consideration the capabilities of the locals,

In cases where a foreign company's services are essential, incorporation of a local company as a partner in the process must be made mandatory, he said.

"Doing these two things at the same time will help us create skilled manpower," he added.

Besides, foreign direct investment and local investment will come about and a huge amount of foreign currencies will be earned through exports, he added.

A Towhid, founding president of the BASIS, administered the oath to the newly-elected executive council.

State Minister for Commerce Ahasanul Islam, State Minister for Post, Telecommunication and Information Technology Zunaid Ahmed Palak, and FBCCI President Mahbubul Alam also spoke at the event.