Tk 5,23,150cr budget tomorrow
No new taxes planned, banking sector, capital market, social security scheme to see major reforms
Published : Wednesday, 12 June, 2019 at 12:00 AM Count : 497
Finance Minister AHM Mustafa Kamal is going to place the annual budget for 2019-20 before parliament tomorrow. This time the budget size will be Tk 5, 23,150 crore.
The size is 18.1 per cent of the total gross domestic product (GDP) including the annual development budget involving Tk 2, 02721 crore.
The Finance Minister will unveil the proposed budget targeting 8.25 per cent GDP growth for next year.
The Planning Commission is reportedly working on prioritizing the issues and making allocations accordingly so that important projects in the annual development programme (ADP) can be completed in time.
The budget will also have two more special
programmes - one is 'my
village my city' programme and the other is a massive job creation programme.
'My village my city' programme is aimed at converting every village into a local township. Village huts will disappear. The local township will provide modern market places with shopping facilities and internet services, officials said.
The budget on the 100th birth anniversary of Bangabandhu Sheikh Mujibur Rahman will chart out several programme for transition of the country to the status of a developing nation.
The Finance Minister will place the budgef - his first one in the House aiming at achieving new vision for the nation.
According to sources, the major reforms proposed in the upcoming budget will include banking sector, capital market development, overhauling savings certificate market and social security programmes.
Taxpayer will be kept free from new taxes, although tax net will expand. There will be another important announcement on MPOs for educational institutions apparently to meet demands of a section of teachers.
Besides this, announcement of a fund may come for unemployed people who will be able to take loans from it on easy term.
Apart from this, the budget may announce the launching of a 'grain insurance scheme' at first as a 'pilot project' for the farmers. Initially, a district will be chosen. Later it will spread throughout the country.
In addition, new initiatives will include insurance for expatriates.
Currently there are 70-80 lakh expatriates abroad. And every year 5 to 7 lakh people are going out on job permits. They will be taken under insurance benefits. Because many are losing jobs in foreign countries and returning home being crippled and killed in accidents.
Young people going abroad are also being cheated in various ways. Their risks may be minimized taking them under such insurance scheme.
The sources said that budget will allocate more funds to productive sector to accelerate employment, exports and higher growth. Special instructions have been given to finance job creation projects to create more income generating activities.
Development of software industry and information technology will remain high on the list to achieve the goal of creating digital Bangladesh by 2021.
The Finance Ministry sources said the government is planning to bring GDP growth to two digits before 2021.
The budget is now being planned on a three-year cycle - one year passed another year included. Human resource development, power and communication sector to receive the highest priority.
During 2018-19 the GDP growth was 7.88 per cent. This year, it is expected to be around 8.25 per cent, the sources said. The inflation rate is likely 5.5 per cent in the upcoming fiscal year.
Estimates suggest this time budget deficit is likely to be at Tk 145,300 crore, which is however within admissible limit of prudent fiscal guideline.
Like other years, 5 per cent of GDP deficit financing has been kept in the upcoming budget. To meet this shortfall, the gap will be met by foreign aid of Tk 63, 848 crore and Tk 77,363 crore from domestic sources.
Total revenue collection has been targeted at Tk 3, 77,800 crore. Out of it NBR will collect about Tk 3, 41,700 crore, non-NBR sources will contribute Tk 17,000 crore and the non-tax sources will provide Tk 37,500 crore. This is equivalent to 13.1 per cent of GDP.
The new budget will have big reforms agenda in VAT sector. The VAT law will be implemented from July 1.
Apart from this, the non-tax exemption limit is not likely to be extended. The budget will have special measurers to expand tax net as the number of taxpayers in the country is still negligible compared to other countries.
Officials said the tax-GDP ratio in the country is very low not more than 10 per cent though it is more than 15 per cent in any other countries.
The National Board of Revenue (NBR) will conduct tax surveys in all houses at divisions, districts and Upazila levels.
Sources at the Finance Ministry and NBR said eligible business entities at the district and upazila levels will be brought under the tax net.
The Executive Committee of National Economic Council (ECNEC) has approved the overall budget at a meeting last month. It also includes a budget for Tk 12,000 crore for semi government and autonomous institutions.
The government sources said implementation of ten-megaproject will be high on the priority and they will get enhanced allocation of Tk 36,000 crore in the budget.
The highest allocation has been given to transportation sector for Tk 52,806 crore. Next come power sector having allocation of Tk 26,017 crore.
Planning Ministry sources said 10 mega projects are currently at the final stage. So, the government will keep bigger allocation so that they can be completed soon.
Social safety net programmes are getting priority. About 13 lakh poor will be added to new protection scheme.
It will benefit about a total of 89 lakh poor. Under the current budget 76 lakhs poor are benefiting from safety net programmes. The new budget will give Tk 5,321 crore allocation for this purpose.