The national budget for 2015-16

The finance minister (FM), M A Muhith,  read out the national budget for the next fiscal year, 2015-16, on Thursday. Even before the FM’s formal presentation of the budget for the new fiscal year, his seventh in the series so far, it was no secret that he would be presenting the country’s biggest ever budget in terms of outlays of resources and their allocations.
In fact, the trend of  exceptionally bigger budget was introduced by him from 2011 and every year since then the budget’s size has been rising heftily. Critics every time also prophesied that the swollen budget size would make mobilization of resources for the same exceedingly difficult ; they considered the budgets  not implementable. But proving the pundits wrong, every budget in the end turned out to be reasonably well implemented.
Thus, it was no surprise that the chorus again of a budget incapable of implementation because of its very size, started soon after the FM finished his budget speech. The familiar criticisms are again noted that the National Board of Revenue (NBR) would be failing to reach the set revenue target for 2015-16. But the NBR in each recent  fiscal year was seen progressively picking up more and more revenues compared to the preceding year. This time it has been tasked with the daunting  target of collecting Tk 176,370 crore or 30 per cent higher revenues. This is the highest ever requirement for increasing  revenue collection at one go  to be faced by the NBR.
But as the FM underlined in his post budget press conference, the NBR has a fine tuned game plan ready that would help it to reach the target. Given its revamping and  the rising efficiency of NBR officials, this body’s at least near attaining of the target does not look impossible though the critics would have us believe otherwise.
However, the above things are not said to give the proposed budget for next year a completely clean bill of health. Also we know that the budget is in proposal form and not set in stone. It can incorporate additions, deletions and alterations before it is finally adopted. Therefore, we suggest that the proposed rate of the ‘tax at source’  to be applied on the export-oriented garments sector be lowered from 1% back to 0.3 per cent that prevails now. The export oriented garment sector has a ‘pivotal’  role in the economy and putting its competitiveness under further stress when this industry is facing serious external challenges for short term revenue gains, would not be an economically prudent course to take. The finance minister also will have to think hard  how he would meet the credit demands of the private sector as a whole when he has planned to borrow freely from the banks to plug budgetary deficits next year.

The national budget for 2015-16

The finance minister (FM), M A Muhith, read out the national budget for the next fiscal year, 2015-16, on Thursday. Even before the FMs formal presentation of the budget for the new fiscal year, his seventh in the series so far, it was no secret that he would be presenting the countrys biggest ever budget in terms of outlays of resources and their allocations. In fact, the trend of exceptionally bigger budget was introduced by him from 2011 and every year since then the budgets size has been rising heftily. Critics every time also prophesied that the swollen budget size would make mobilization of resources for the same exceedingly difficult ; they considered the budgets not implementable. But proving the pundits wrong, every budget in the end turned out to be reasonably well implemented. Thus, it was no surprise that the chorus again of a budget incapable of implementation because of its very size, started soon after the FM finished his budget speech. The familiar criticisms are again noted that the National Board of Revenue (NBR) would be failing to reach the set revenue target for 2015-16. But the NBR in each recent fiscal year was seen progressively picking up more and more revenues compared to the preceding year. This time it has been tasked with the daunting target of collecting Tk 176,370 crore or 30 per cent higher revenues. This is the highest ever requirement for increasing revenue collection at one go to be faced by the NBR. But as the FM underlined in his post budget press conference, the NBR has a fine tuned game plan ready that would help it to reach the target. Given its revamping and the rising efficiency of NBR officials, this bodys at least near attaining of the target does not look impossible though the critics would have us believe otherwise. However, the above things are not said to give the proposed budget for next year a completely clean bill of health. Also we know that the budget is in proposal form and not set in stone. It can incorporate additions, deletions and alterations before it is finally adopted. Therefore, we suggest that the proposed rate of the tax at source to be applied on the export-oriented garments sector be lowered from 1% back to 0.3 per cent that prevails now. The export oriented garment sector has a pivotal role in the economy and putting its competitiveness under further stress when this industry is facing serious external challenges for short term revenue gains, would not be an economically prudent course to take. The finance minister also will have to think hard how he would meet the credit demands of the private sector as a whole when he has planned to borrow freely from the banks to plug budgetary deficits next year.