Finance Minister Abul Mal Abdul Muhith has placed TK 4, 64, 573 crore taka budget for the 2018-19 fiscal year in the National Parliament on last 7th June. Acting Ameer of Bangladesh Jamaat-e-Islami and former lawmaker Maulana ANM Shamsul Islam has issued the following statement on 9th June, 2018 in regards to this proposed budget.
“The proposed budget has no surprising elements. This is an as usual and impractical budget. The proposed budget has allocated 60 thousand crore taka more, than the previous budget of 2017-18 fiscal year. Total expenditure has set as TK 4, 64, 572 thousand crore taka. In the budget address, finance minister claimed that this huge expenditure will be managed from public taxes, VAT, domestic loan and foreign grants and donations. The total revenue income in the proposed has been estimated at Tk 3, 43, 381 crore. Out of this target, NBR will collect Tk 2, 96, 201 crore. The overall budget deficit will be Tk 1,25,293 crore. Of this, an amount of Tk 54,067 crore will be financed from external sources while an amount of Tk71,226 crore will be financed from domestic sources. Of the domestic sources, Tk 42,029 crore will be borrowed from the banking system while Tk 26,197 crore from National Savings Schemes and other non-bank sources.
GDP target has been set 7.8 percent which 7.4 percent in the previous year. The inflation rate has been set to 5.6 percent which was 5.4 percent in the past year. This ratio substantiates that the proposed budget is fully as usual and most of the proposals of this budget is based on loans. In the past 9 year, the government could not implement any of its budgets properly. It is assumed that the same trend is going to be repeated once again. Even the banking sector is going to be collapsed as the government is taking huge amount of loans from the banks on regular basis.
Though the budget is voluminous but it will not ensure public welfare. The budget also allocated 51, 340 crore taka to pay its loan interest which is 18 percent of the development budget and 11.1 percent of the whole budget.
The proposed budget has all sorts of provisions to convince the affluent sections. On the contrary, it will cause tremendous sufferings for the middle and low-income people. They have nothing positive in this budget. The proposed budget also extended additional privileges for the government staffs, bank and insurance officials. Whilst, the periphery of VAT has been expanded in order to boost up the revenue. This VAT expansion will also cause crisis for the poor communities.
The proposed budget has reduced its allocation in education sector by 10.2 percent. It also exposed the academic austerity measures of the government. The proposed budget doubled the allocation for the election commission to pave the way for their widespread corruption and looting.
As there is no specific stimulus in the budget for the capital market, it will create severe frustration among the investors. The industrial sector will also face some challenges due to this imbalanced budget. It has proposed to extend VAT by one percent in the RMG sector. This decision will put the local garment industries at stake. Furthermore, no effective measures have been so far to attract foreign investment.
The government has proposed to reduce the year-wise depreciation facility on the import of reconditioned cars in the proposed budget. It has proposed a supplementary duty reduction on the import of 1600 to 1800cc hybrid cars from the existing 45% to 20%. So it will reduce the price car and ultimately the richer will be benefited. It will also cut the price of motor cycle, rod, cement and raw material of car’s tyres which also have gone in favour of the affluent corner. On the other hand the budget proposed to increase tax on mobile phone set, hair clip, readymade garments, bicycle, old car, old furniture, UPS and cosmetics, ceramic items, imported rice, chewing gum and chocolates which will cause trouble for the poor income people. But it should be reversed. Price of all items which are being used by the low income people should be decreased.
The government is mulling to provide more facilities to the bank owners through this budget. It has proposed to cut 2.5 percent corporate tax which will benefit the bank managements.
The budget did not propose any allocation to facilitate the inclusion of new academic institution in the MPO list. It will cause resentment and frustration among the new academic institutions. The proposed budget also has no guidelines for the unemployed youth sections.
The proposed budget has overwhelmingly tried to impress the voters. It has kept the allocation of more than 30 thousand crore taka for different mega projects including the Padma Bridge.
This budget remained silent about the provision of legalizing black money. Such passivity will increase corruption and give the ruling party men more options to continue their massive corruption nationwide.
Likely the previous years, the proposed budget also set tax free income threshold as 2 lac and 50 thousand taka. But the budget size has been increased several times more in the mean time. And the prices of essential commodities have increased a lot and so this tax free limit should be fixed reasonably. This budget has disappointed the middle and low income people. In words, this budget is not acceptable to the people at all.
Under the circumstances, I am urging the concerned authorities to amend the budget in order to make it more rational, realistic and practical.”
