With a budget that is aiming for a growth rate of 8.13% and a revenue collection target of Tk3,77,810 crore, the budget for fiscal 2019-20 is nothing if not ambitious.
It should come as no surprise that this is Bangladesh’s biggest budget to date, which is no doubt encouraging, and is one that promises to be more balanced than what we have seen before.
On the one hand, as Finance Minister AHM Mustafa Kamal has said, this new budget encourages growth in the private and public sectors by creating an investment-friendly environment, with changes being made in key areas such as tax management and the financial sector, along with several incentives for RMG and remittance.
On the other, the government has decided to widen its social safety net -- increasing the allocation to Tk74,367 crore -- and introduced a laudable and ambitious pension scheme for everyone, in addition to other generous allotments for those most in need.
This is not surprising -- with an expected revenue collection growth of 17.92% compared to last year’s 7.1% -- but rather ambitious and may not be realistic in its estimate.
But such ambition does not come without reason: The fact that a new tax office in every upazila has been promised while also keeping the tax-free income limit unchanged at Tk2.5 lakh for the fifth year running shows the government’s intentions of widening its tax collection.
However, the provision which allows investors to whiten black money through investment in tech parks and economic zones remains of concern even though this might encourage developments in the technological sector.
At the end of the day, what we have is a budget that encourages businesses, as we have always done, but has also managed, to some extent, to take care of its most vulnerable citizens, with negligible changes in other sectors.
