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6 June, 2021 11:36:51 PM / LAST MODIFIED: 6 June, 2021 11:39:02 PM

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Budget FY 21-22: Implementation is the big challenge now

The steps taken to create employment would have been more effective if it had been linked to corporate tax exemption. This year's budget has given various incentives for the production of various products domestically, which will increase investment in the private sector and strengthen the economy
Majhar Mannan
Budget FY 21-22: Implementation is the big challenge now

The proposed budget for the new financial year is 50th on the golden jubilee of Bangladesh's independence. The country's economy is under pressure due to Covid -19 pandemic and such a proposed budget is certainly important and everyone hopes that this budget will be beneficial for the common man.

Expenditure in the proposed budget is 6,03,681 crore taka, income 3,89,00 crore taka and deficit 2,14,681 crore taka. There is good reason for businessmen to be happy with the new budget proposal for FY 2021 22 as corporate tax rates have been reduced and local industries have been protected, but experts have questioned how much the general public will benefit from this budget. The finance minister has said that 80% of the country's population will be vaccinated against coronavirus in phases.

He also said that a lump sum of 10,000 crore taka would be allocated to meet the urgent demand for Covid -19. In this year's budget, 32,731 crore taka has been allocated for the health sector, which is 12 percent more than the current year and 5.4 percent of the total national budget. It is good news that the allocation in the health sector has been increased keeping in mind the issue of Covid -19 epidemic. 

This year's budget has promised to increase some allowances for the poor, but there is no good news for the middle class. Although the income of the common people has reduced due to the pandemic, they do not get any exemption in the case of paying tax, i.e. if it is more than three lakh taka per year, they have to pay tax compulsorily. In the proposed budget, the finance minister has proposed to increase the allowance of the heroic freedom fighters. This is definitely a good thing. It has been proposed to increase the allowance of heroic freedom fighters from Tk 12,000 to Tk 20,000 with effect from July. The government wants to bring 8 lakh elderly citizens of 120 upazilas under the new allowance and for this an additional allocation of Tk 481 crore has been proposed for old age allowance, the finance minister said. Undoubtedly this is a good aspect. However, this year's budget provides a variety of facilities for businesses, but the allocation to the social security sector appears to be less than necessary, and at the same time, the allocation to the disaster management sector is insufficient, experts say.

TIN has been made mandatory for house design approval and purchasing savings certificates of more than 2 lakh taka. Such an initiative has been taken in this year's budget to bring more people under the tax. In this year's budget, there is no direct opportunity to launder black money, but indirectly, this opportunity remains. Bangladesh has already made the transition from a least developed country to a developing country and an outline to address the challenge of this passage has been given in this year's budget and it is undoubtedly a good one. In this year's budget, not only corporate tax but also tax in other areas has been reduced a lot. With the highest emphasis on 'Made in Bangladesh', an opportunity has been created to protect the domestic industry.  However, the steps taken in the budget to create employment would have been more effective if it had been linked to corporate tax exemption.  This year's budget has given various incentives for the production of various products domestically, which will increase investment in the private sector and strengthen the economy. The finance minister has done everything he needs to do in the industry to meet the challenge of the epidemic, but many think it would have been more effective to increase the personal income tax-free limit from Tk 3 lakh to Tk 3.5 lakh.

Although the budget allocates for marginalized people, the lower middle income people seem to be somewhat neglected here. The tourism sector is in the grip of the Covid -19 epidemic, but no action has been taken in this year's budget. Many people have lost their jobs and many have become poor due to the epidemic but there is no notable programme in the budget for these poor people. Several steps have been taken for women entrepreneurs in this year's budget, but it would have been better to give loans to small and cottage entrepreneurs from the incentive package.
This year's budget announces a reduction in corporate taxes, which will increase the company's revenue in the productive sector and help turn the wheel of the economy. The finance minister said this year's budget has given special opportunities to traders, which means they will go into production and create jobs. A budget of Tk 6,3681 crore has been proposed for the next financial year, of which one-third is deficit budget. And to meet this deficit budget, loans have to be taken from development partners and a large part of the budget goes to repay these loans. The Covid -19 epidemic has damaged the country's trade and commerce, and in such a situation, the more cooperation the private sector receives, the faster it will be able to turn around. This year's budget calls for 7.2 percent growth, and in order to achieve this growth, investment in the private sector must be greatly increased and must be monitored. This year's budget proposes a waiver for the agricultural sector and the establishment of hospitals, which is undoubtedly a positive side but the government needs to monitor more so that low-income people can take advantage of this.

However, in the proposed budget, more allocations have to be made for vaccines and steps have to be taken for speedy implementation of vaccines. However, no matter how much money is announced, the implementation of the budget is the biggest challenge and the people of the country believe that the government of Bangladesh will be able to implement this budget.

The writer is Assistant Professor, B A F Shaheen College, Kurmitola, Dhaka Cantonment.
 

 

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Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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