Kamal defends tax cuts and other exemptions in the proposed budget
The proposed budget for FY2021-22 is business-friendly and it aims at increasing production and creating employment opportunities, Finance Minister AHM Mustafa Kamal has said.
“This year’s budget is a business-friendly budget. Businesses will get various opportunities from this budget, and they will increase the production. If production is increased, it will also increase employment since production is impossible without manpower,” the minister said in the virtual post-budget press briefing on Friday.
In response to a question about not having the opportunity for black money, the finance minister said he had never talked about black money.
“The precaution we put in our budget is undisclosed income. There is a big difference between black money and undisclosed income. Black money is accumulated through corruption while undisclosed money is created because of our system,” said Mustafa Kamal.
He also said that the budget had proposed to reduce the tax rate, and the collection of revenue would increase if it could be implemented.
“Our intention is to make the revenue law easier. We believe that if we can simplify the law and involve the taxpayers in this work, revenue generation will increase significantly,” he added.
“Many countries of the world have tried to increase revenue generation. Even the United States once had a 75% tax rate, though this is no longer the case,” he said.
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The finance minister presented the proposed budget, titled “Protecting lives and livelihoods for the fiscal year 2021-22”, in parliament on Thursday.
The size of the 50th budget of the country has been proposed at Tk603,681 crore.
Responding to a question from reporters about the record deficit, Planning Minister MA Mannan said that the deficit budgets were not new in the world.
“We are a developing nation, and the budget of such a nation will always be a deficit. We are in a world of conjecture. There will be no benefit in arguing about it,” he said.
Agriculture Minister Abdur Razzaq said that the agriculture sector had high potential.
“Bangladesh is now producing goods rather than importing.
“We are going to export our agro products after meeting the domestic demands. For this, the government gives opportunities to the exporters and imposes a tariff on importers,” the minister said.
He also said that there had been a revolution in the poultry and dairy sectors – thanks to new technology, development of breeds and knowledge.
“In this case, the government wants to increase production by providing more opportunities to the entrepreneurs, which will increase production, decrease imports and create employment,” he added.
However, the allocation for health is not consistent with any of the expectations or needs during a pandemic, say experts.
Abdur Rouf Talukder, secretary to the Finance Division, said that the allocation for the health sector had been increased by 13% from last year.
“There is no problem with the allocation for vaccination as there are enough funds, and, if necessary, it can be taken from other sectors,” he added.
He also said that initiatives would be taken to bring transparency in the purchasing of equipment for the health sector.
The deficit in the budget stands at Tk211,191 crore, including grants, which is 6.1% of the GDP. Excluding grants, the deficit stands at Tk214,681 crore.
Regarding the deficit, the finance minister said that Tk113,453 crore in loans would be taken from the domestic sectors and Tk98,738 crore from the foreign sector.
Among the domestic sectors, the target for loans from the banking sector is Tk76,452 crore, Tk32,000 crore from savings certificates, and Tk5,001 crore from other sectors.