The budget proposed in the national parliament is of more than Tk 761 thousand crore with the government aiming to bring down the inflation to 6 percent while fulfilling the growth target of 7.5 percent for the FY 2023-24.
The proposed budget is 15.2 percent of the GDP. Some Tk 2 lakh 63 thousand crores are allocated in Annual Development Program (ADP) and operating expenses are set at Tk 4 lakh 36 thousand 247 crores.
Meanwhile, experts think that the IMF loan conditions are the biggest pressure in implementing the budget. To fulfill this condition, the government will have to collect Tk 65 thousand crore of additional tax from the people.
Universal taxation will be introduced for this. This means everyone has to pay at least Tk2000 tax each. As a strategy of tax collection, this tax has to be paid to get 44 types of services for a normal life. Corporate tax is not being reduced to increase the government`s income this time.
Also, the growing inflation appears to be a massive challenge.
Dr Salehuddin Ahmed
Former governor, Bangladesh Bank
The former governor of the central bank, talking about the proposed budget, termed the budget difficult and not implementable. Considering the overall aspects including inflation control, it is not an implementable budget.
About revenue collection. Salehuddin said, the NBR has relied more on direct taxes this time. The biggest negative aspect is tax evasion. It is not a good sign that only 30 lakhs of the 90 lakh taxpayers are registered.
In response to the question whether there is any initiative to bring FDI or foreign investment in the budget, Salehuddin said, “I have not seen anything like bringing in FDI. But it is a good thing that corporate tax has not been increased.
“The downside is that land registration costs are increasing. Corruption is also a challenge. Besides, Moody`s downgrade of Bangladesh`s credit rating will also have an impact on attracting FDI. Those who come will assess the risk premium.
Regarding the stock market, he said that the tax has not been increased, it is a positive aspect. They were afraid that taxes might be increased. That didn`t happen. This will affect the market.
He said one thing the government has done is not talk about black money or undisclosed money. Now let those who have such money understand. What to do or not to do There are many techniques. Hundi is also a path. Money can also be brought through this.
M Masrur Reaz
Founder, Policy Exchange Bangladesh
The economist commented that the 7.5 percent growth target in the budget is ``unrealistic``. He said that in the current economic reality, it is more important to maintain moderation by discounting high growth.
In his post-Budget response to TheReport.Live, he said, "Just the budget has been presented. There is time. The budget should be justified or realistic in at least three areas: growth, investment targets and revenue collection."
Dr. Masur Reaz said that the target of 28 percent investment and 16 percent revenue collection is against reality at present. By doing this, the balance of payments will continue to deteriorate.
He said the dollar crunch will also intensify while rising prices of electricity and gas will disrupt industrial production.
He said that the high inflation has put a lot of pressure on the macro economy. Then again, bank borrowing to meet development expenditures will lead to worsening conditions.
Dr. Masrur said that the government`s operating expenses have been increased by 15 percent. This will increase the money supply in the market and fuel inflation. As a result, there will be great suffering in the lives of common people.
Manzur Ahmed
Trade and Policy Adviser, FBCCI
The expert said that the views of businessmen given in the pre-budget discussion were not reflected in this year`s budget.
He said that this budget is against reality.
Meanwhile, the deficit in the budget is Tk2 lakh 61 thousand 785 crores. It is 5.2 percent of the GDP. In the last budget, this deficit was 5.5 percent or Tk2 lakh 45 thousand 64 crores which has come down to 5.1 percent in the revised budget. In terms of money, its amount was Tk2 lakh 27 thousand 507 crores.
It is planned to supply Tk1 lakh 40 thousand 425 crore taka from internal sources and 83 thousand 819 crore taka from foreign sources in the current financial year to meet the deficit. It is planned to take Tk1 lakh 55 thousand 395 crore from internal sources and Tk1 lakh 2 thousand 490 crore from foreign sources to meet the deficit of Tk2 lakh 61 thousand 785 crore taka in the next budget.
In the budget speech, Finance Minister A.H.M. Mustafa Kamal said that the success of the government in dealing with the Covid-19 situation and speedy recovery and protecting the health of the people has been appreciated globally.
Efforts to expand the scope of emergency health services, food security, employment and social security have been continued with 28 incentive packages worth Tk 2 lakh 37 thousand 679 crore to overcome the Covid crisis.
The finance minister said that the continuation of this effort will be maintained. When the government will do what is necessary under the circumstances.
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