Yet another big budget today
Reforms, futuristic measures to dominate proposals
Kazi Zahidul Hasan :
Finance Minister A H M Mustafa Kamal will place the national budget for the upcoming fiscal year in parliament today, outlining plans and strategies towards achieving the country's future development goal.
He is likely to place another 'big budget' taking the trend of previous budgets of ruling Awami League.Â Â Â Â
The size of the upcoming budget has been estimated at Tk 5,23,190 crore, the highest in monetary term in the country's history.
The budget for 2019-20 would be 650 per cent bigger than the original budget of the country's first budget and 18 per cent bigger than the original budget (Tk 4,64,573 crore) of the outgoing fiscal.
Late Tajuddin Ahmed, country's first finance minister, presented the first one in 1972 in the parliament, with only Tk 786 crore expenditure plan.
In his maiden budget speech, the Finance Minister may propose a number of reform measures to encourage investment, promote jobs, boost exports and stimulate GDP growth.
"You will see a lot of reforms in different areasÂ Â in the next budget," said the Finance Minister at a consultative committee meeting between the NBR and business community.
He said such measures would be rolled out to make economy more vibrant.
The Finance Minister may announce a fresh black money whitening scheme in the next budget to attract investment and unveil plan for enlarging the number of registered tax payers to one crore to increase the country's tax to GDP ratio.
Officials said, people would get the opportunity to disclose their undeclared income through investment in the industrial sector.
Among the major income tax measures, he may also propose extension of tax holiday facilities for industrial sectors until 2024, reduction of area-wise real estate tax rates, and upward adjustment of tax-free ceiling for dividend income in his budget speech.
"Futuristic measures will dominate his budget proposals that will lead the country to the next development path," an anonymous finance ministry official told The New Nation yesterday.Â Â Â Â
He also said that it will also focus on fulfilling electoral pledges of the ruling Awami League that assumed office for the third consecutive term after the landslide victory in December 30 national election.
In the fiscal year 2019-20, the total revenue income has been estimated at Tk 3,77,810 crore, according to leaked budgetary outlines.
Of this target, the National Board of Revenue (NBR) has been tasked to mobilise Tk 3,25,600 crore revenues, which is 17.92 per cent more than the outgoing fiscal 2018-19.
The estimate of tax from non-NBR sources has been fixed at Tk 14,500 crore, the non-tax revenue (NTR) at Tk 37,710 crore and Tk 4,168 from other sources.
The next budget will announce the implementation new VAT law with multiple rates from July 1, and it will be a key tool for NBR's additional revenue income.
The new budget may not bring any cheer to the individual tax payers, as it may keep the existing tax-free threshold for individual taxpayers and corporate tax rates unchanged for fiscal year 2019-20.
In the next budget, the allocation for the non-development and other expenditure has been estimated at Tk 3,10,262 crore and development expenditure at Tk 2,11, 683 crore, leaving Tk 1,45,380 crore deficit which is 5.0 per cent of the GDP.
The next budget is likely to project the GDP growth target at 8.2 per cent and rate of inflation at 5.5 per cent.
Officials said, the new budget would launch several new schemes, like crop and expatriates' insurance, start up fund and incentive against remittance, from the next fiscal year to support the farmers, remittance senders and unemployed youths.
The government would allocate Tk 2,800 crore fund in the next budget for providing incentive to the remittance senders and Tk 100 crore for start-up fund.
Unemployed youths can be entitled to take loan from the start-up fund for launching a business venture. The fund will be raised further if the scheme gets response from the targeted group, said a finance ministry official.Â Â Â
Besides, crop insurance would be launched in a particular district on the pilot project basis.Â Â Â
The Finance Minister may also announce widening of the coverage of social safety-net programme in the next budget adding 13 lakh more people under its net from the upcoming fiscal year, taking the total number of beneficiaries to 89 lakh.
The government is likely to set aside Tk 70,000 crore fund in the next budget to implement the programme.
The budget will offer tariff protection for local industries to sustain their production and maintain edge in global arena.
"The budgetary goals are ambitious and difficult to achieve under the prevailing economic condition," Professor Mustafizur Rahman, Distinguished Fellow at the Centre for Policy Dialogue (CPD) told The New Nation yesterday.
He said employment generation is one of the key challenges before the government in the Budget 2019-20.
"The government should pay serious attention for raising private investment and jobs through budgetary measures in the next fiscal year. "Otherwise, it will face challenge in sustaining growth."Â Â
Professor Mustafizur Rahman urged the government to fix the banking sector malady to increase private investment.