Please Share If You Like This News

Buffer Digg Facebook Google LinkedIn Pinterest Print Reddit StumbleUpon Tumblr Twitter VK Yummly

The proposed national budget has not reflected the pledges of the Awami League’s (AL’s) poll promises as it would still favour the beneficiaries of economic misrule instead of poor people, according to the Centre for Policy and Dialogue (CPD). In a budget analysis, CPD’s distinguished fellow Dr Debapriya Bhattacharya said: “Without fulfilling the demands of the poorer segment of the population in education, health and social expenditure, it would not be possible to become a middle-income country.” Expressing concern over the widening disparity, Bhattacharya said: “No society will be able to withstand a widening disparity. It’s historical truth. Bangladesh has come into existence through a fight against discrimination. Everyone wants a high middle-income country. But if discrimination increases, it'll not be achieved.” - A home for your website

“The proposed budget has given more facilities to high-income people. The poor will only get marginal benefits. The most important question is how poor people are getting education, health facilities and public transports. Poor people cannot go to Bangkok or Singapore for treatment,” he continued.

“The middle-income status depends on what we can do for middle-class people. It is interconnected. The middle class is the main driving force,” he added.

Bhattacharya made these observations at a programme titled ’National Budget for FY2019-20 an Analytical Perspective’ at a city hotel yesterday. He also raised questions regarding the transparency of the budget. “There is a gap between information given by the National Board of Revenue (NBR) and the finance ministry,“ he pointed out.

"Emerging challenges in economic management have largely remained unaddressed in the budget. Despite being the budget for the terminal year of the Seventh Five Year Plan, there was no visible urge to make a last stride towards the fulfilment of the planned targets. There is no innovation in matters of inflation, trade policy or subsidy distribution. The finance minister’s budget presentation has innovation, but it lacks innovation in budget preparation,” he said.

“The budget should have been prepared in line with the ruling party’s election manifesto, taking into account all the sectors. A number of promises have been made, such as the generation of employment and raising the number of taxpayers, but it does not have any concrete time-bound plan or programme,” he also said.

“The budget might have some airy promises, but we don’t find any concrete plans to fulfil them,” he further said.

“We are always talking about structural reforms in the annual development plan, revenue programme and services. But we have been repeatedly deprived of this in the budget,” he added.

“The entire development programme is standing on infrastructural development with government money and the prospect of achieving growth through it. But it is a prehistoric idea. It does not have any connection with inclusive development,” he observed.

“The growth rate is increasing, but poor people are not being benefited. This results in pressure on social capacity. The discrimination is widening in income, richness and consumption. The discrimination is more evident in the rural economy,” he said.

He also said the size of the budget had been increased in terms of money, but the GDP had not been increased. “If GDP does not increase by 16 per cent, our desire to become a middle-income country will not be fulfilled,” he added.

Regarding problems in the banking sector and the share market, Bhattacharya said: “Those who have taken unjust advantages do not want any reforms. They do not want transparency. They do not want the banking commission because they fear their secrets will be revealed.”

He said a mere expansion of the tax net was not sufficient and instead money laundering had to be checked.

In the budget analysis, Bhattacharya said: “The education budget has decreased as a share of the total budget. But the AL’s election manifesto had promised a highest allocation for education. The implementation of the overall education budget in FY18 (85.8 pc) is the lowest in the last decade, although the manifesto had promised that a proper utilisation of education funds would be ensured.”

He also said that revenue collection by the large tax unit had decreased (11.2 per cent) due to a marginal improvement expected in the collection of VAT and SD (4.3 per cent). He further said the allocation for agriculture was decreasing. “This time, agriculture received 20.8 per cent of the total allocation (Tk. 9,000 crore)—a similar allocation since FY 14. Even over the last three years, it has never been possible to fully spend the agriculture subsidy (Tk. 2,570 crore, Tk. 5,390 crore and Tk. 3,800 crore remained unutilised in FY 16, FY 17 and FY 18),” he added.

The CPD objected to giving cash incentives for exports and remittance inflow. It proposed a gradual depreciation of the taka to help incentivise exports and remittances, thus doing away with cash incentives.

The government could save Tk 9,385 crore from unutilised agriculture subsidies and provide a one-time Tk 5,000 to each card-holding farmer’s bank account—this amounts to Tk. 9,100 crore—to compensate partly their incurred losses during the Boro season, the CPD said.

Bhattacharya said the government used foreign aid requirement as a tool of covering the budget deficit. “But we have seen that less than four billion of aids came last year instead of seven billion,” he added.

He could not agree with bank borrowings to cover up the budget deficit.

About the annual development plan (ADP), Bhattacharya said: “Revenue surplus as a share of financing ADP is increasing in terms of allocation. But it is declining in terms of actual expenditure.”

He appreciated the government for not taking up any new projects.. “The share of allocations for finishing projects has been increasing marginally, but it is declining for carryover projects. The share increased to 28.7 per cent in FY 20 from 22.7 per cent in FY17,” he said.

The rich will benefit from the wealth surcharge as the minimum net exemption limit has been increased to Tk. 3 crore from 2.25, leaving a number of rich people out of the surcharge net. It implies that a taxpayer even after owning four 2000 square feet flats in Gulshan area will be exempted from paying the surcharge.

The CPD has lambasted the continuation of the existing provision on untaxed or illegal money, saying it will encourage immoral/illegal activities and discourage regular taxpayers. It demands a legal framework to deal with benami property, which has not been addressed.

The CPD has welcomed initiatives like the VAT exemption threshold, VAT exemption on showroom run by women entrepreneurs, handmade confectionary, non-mechanical carriage for disabled persons, medical equipment, jute-based products, among others.

Report by - //

Facebook Comments