The Jatiya Sangsad yesterday passed the Tk2,95,100 crore national budget for the 2015-16 fiscal year.
The JS also adopted by voice vote the Appropriation Bill 2015, piloted by Finance Minister AMA Muhith, seeking budgetary allocations of Tk4,15,308 crore for meeting development and non-development expenditures for the various ministries. The additional amount has been sought for meeting mainly the liabilities.
On Monday, the JS passed the Finance Bill 2015, which incorporated some revisions to the original budget placed on June 4.
The passage of these two bills means that the national budget, that has a deficit of less than 5% of the projected GDP, comes into effect today.
The total income of the budget is estimated at Tk2,14,243 crore and the remaining Tk86,657 crore will be the deficit.
Leader of the House and Prime Minister Sheikh Hasina and Leader of the Opposition Raushan Ershad were present when the budget was approved.
The leader of the house, opposition leader, finance minister, other ministers, members of the treasury and opposition benches and independent lawmakers discussed the budget proposal over 18 working days of the JS starting June 8.
Ministers in charge of the various ministries placed their expenditure proposals through 56 demands for grants which were passed by voice vote.
In response to strong criticism by several main opposition Jatiya Party and indepdent lawmakers, Finance Minister Muhith said yesterday: “We have worked together to bring back confidence among the clients of the state-owned banks ... None of the corrupt officials of these banks will be spared. We want to bar those who will try to go aboard.”
Regarding the loan scams, Muhith said: “We have managed to bring one deputy manager of the Sonali Bank to jail ... But I have not been able to bring some directors [of the bank] to jail. They are all criminals, accused of fraud. They have been staying out with backing from our people. This makes me angry.”
Whether the new pay scale for public servants would affect teachers, the minister said: “The pay scale will come into effect on July 1. But MPO teachers will be brought under that scale a couple of months later.”
Under the appropriations approved on the day by the JS, the Finance Division got the highest Tk1,94,397 crore, followed by the Local Government Division’s Tk18,871 crore, Defence Ministry Tk18,377 crore and Education Ministry Tk17,113 crore.
According to the Finance Bill 2015, exporters, other than those from the readymade garment sector, will now have to pay 0.6% tax at source on their income from export.
Initially, the proposal was for a 1% tax at source. This was first revised to 0.8% and then reduced further to 0.6% upon request from Prime Minister Sheikh Hasina.
Currently, garment manufacturers pay 0.3% tax at source and other manufacturers 0.6% on their annual export income.
The proposed 10% VAT on the tuition fees at private universities, medical and engineering colleges was revised to 7.5%.
Upon Hasina’s recommendations, the duty and VAT on raw materials for producing cancer drugs were withdrawn. Moreover, there will be no VAT on unani, ayurvedic and herbal drugs at the production stage.
The finance minister also lifted the 5% duty on the import of books and the 2% advanced income tax that he had earlier proposed on the import of food commodities such as rice, sugar, wheat and edible oil.
The supplementary duty on import of motorcycle in completely built form was increased to 60% from the existing 45 % in an effort to encourage the local industry.
Corporate tax for listed banks will now be 40%, down from the proposed 42.5%. But it will be applicable for new banks, non-banking financial institutions and insurance companies that got licence in 2013 and are not listed with the stock exchange.
From FY2015-16, the minimum income tax at the individual level will be Tk5,000 for those living in Dhaka and Chittagong city corporation areas, Tk4,000 for those in other city corporations and Tk3,000 for those living in the other areas. The primary proposal was for a Tk4,000 uniform minimum tax for all.
Parents of students of English medium schools in the city corporation and municipality areas will have to submit their taxpayers’ identification numbers (TINs). But this stipulation will not apply to those from outside these areas.
The projected GDP growth rate is 7%, and the inflation forecast for FY2015-16 is 6.2%.
