Dhaka (The Daily Star/ANN) - Bangladesh'S national budget of 2012-13 will be about 17 percent bigger than the current one, Finance Minister AMA Muhith said yesterday.
The next fiscal year's allocation will be nearly Tk 1,90,000 crore, up from Tk 1,63,000 crore budget of this fiscal year, he said.
The minister also said his target is to keep the budget deficit below 5 percent in the upcoming FY.
¡°The Tk 1,90,000 crore budget is not an ambitious one,¡± Muhith said while briefing journalists after a pre-budget meeting with economists at the state guesthouse Padma in Dhaka.
¡°The next budget should be more than Tk 2,00,000 crore to provide citizens with the necessary facilities.¡±
In the next budget, he said, the government will mainly focus on institutional reforms and productivity of the investment. The government will seek to increase income from non-NBR (National Board of Revenue) revenue sources to meet its expenditure.
The minister said economists at the meeting suggested proper utilisation of foreign aids so that economy gets the proper boost.
A group of economists belonging to different think tanks also suggested the minister fix a minimum tax for Tax Identification Number holders as many of the TIN owners evade taxes.
Muhith said currently the number of TIN holders could be around 50 lakh, but only 8 lakh people pay taxes regularly. Many eligible persons dodge taxes by using loopholes in the TIN system.
He said the economists did not discuss anything on black money in the meeting. But they recommended formulating a coal policy and rationalising subsidies in sectors like education, food and export.
The economists suggested the minister devise a unified subsidy policy as the government does not have specific estimate of subsidies that make a big dent in its yearly spending.
At the meet, they also spoke for strengthening foreign trades, which generate 60 percent income of the country.
The experts stressed the need for education reforms through bringing changes in curricula and teaching methods, the finance minister said.
He added in the next budget the government will lay emphasis on housing for the low-income people and introducing a viable transport system.
Muhith also said the economists suggested rationalising the property taxes as the prices of land increased manifold over the last few decades.
As an example, Muhith said, many people bought a piece of land at the capital's posh area at Tk 20,000 years ago, but they are paying the property tax at the earlier rate, although land prices have already crossed crores.
¡°So, we have a plan to rationalise the wealth tax in the next budget.¡±
When his attention was drawn to giving licence to new banks, Muhith said the government did not issue any licence to any new bank yet, although the central bank has already recommended three.
¡°Bangladesh Bank suggests a lot to the finance ministry, but all suggestions are not considered. A total of 49 applications were submitted to the finance ministry for new banks,¡± he said.
Economists from different organisations including Policy Research Institute, Bangladesh Institute of Development Studies and Bangladesh Economic Association attended the meeting.