Dhaka: State minister for the planning division Zonayed Abdur Rahim Saki on Sunday defended the proposed national budget, saying that despite concerns over financing, the government’s revenue target would be achieved through tax reforms, automation and stricter measures against tax evasion.
Participating in the budget discussion chaired by speaker Hafiz Uddin Ahmed, Saki said many lawmakers had questioned the size of the proposed budget and the sources of its financing.
He argued that Bangladesh’s budget, amounting to about 13 per cent of gross domestic product, remained relatively small compared with neighbouring and other countries where government budgets generally accounted for 30 to 33 per cent of GDP.
‘If we consider Bangladesh’s population and where we want to take the country, this is actually a small budget,’ he said.
The state minister said the government had inherited a ‘devastated and fragile economy’ and designed the budget in line with the country’s current economic capacity to support reconstruction and long-term prosperity.
Describing the proposal as an expansionary rather than a contractionary budget, Saki said it balanced development priorities with prevailing economic realities.
Responding to concerns over the government’s ability to finance the budget, he acknowledged doubts about achieving the Tk 695,000 crore revenue target because of the National Board of Revenue’s past performance.
He, however, claimed that revenue collection had increased significantly during the past four months compared with the corresponding period of the previous fiscal year following measures adopted by the government.
Saki attributed Bangladesh’s chronic revenue shortfall to tax evasion, tax fraud and excessive tax exemptions, saying the government had accelerated automation of tax administration to curb leakages.
He also referred to Sunday’s inauguration of automation programmes for the NBR and five other institutions.
Addressing concerns that small grocery shops and traditional markets would be brought under the tax net, Saki said the government had rationally expanded the tax base and would initially impose flat-rate taxes based on taxpayers’ capacity.
The minister also announced plans to separate tax policy formulation from revenue collection by establishing an expert-led policy-making body independent of the bureaucracy.
He expressed confidence that the government would achieve its revenue target in the coming financial year through stronger enforcement against tax evasion.
