BUDGET for a country's economy is like an air-tight balloon in which air consists of revenue, expenditure and financing. It is the knot that ties all these components together. If one of the components of air becomes unbalanced, the balloon will explode.
One of the underlying assumptions of the proposed budget of 2017-18 is that peoples' perseverance, and peasants' and workers' passion for work will help sustain political stability and thereby ensure economic growth. But to sustain this situation a motivational budget is needed because of which peoples' net income will support their living and other costs in a proper manner.
Bank being one of the most sensitive sectors of a country as it deals with others' money, the rate of interest on deposits was reduced to single digit, i,e., 5.01 per cent at the end of March 2017. Moreover, the government is going to impose additional excise duty on bank deposits. This is contradictory.
Furthermore, imposing excise duty contradicts the policy of financial inclusion. The bank account holders who have a specific amount of deposit money are already financially included because they are paying excise duty by now. Beside this, a person whose total income exceeds Tk 250,000 has to pay income tax. So the excess excise duty is a kind of double burden on bank account holders and if this policy is implemented, it would create antipathy and frustration among them.
The highlighted topic of the proposed budget is additional excise duty on bank accounts. And, it can be said that imposing excess excise duty will not be fruitful at all for the general people.
During the last eight years the government has taken many measures to enhance the capacity of the National Board of Revenue (NBR) though the export volume and inward remittance in the outgoing fiscal year were far less than expected. In the budget of FY 2016-17, the estimated tax revenue was 12.4 per cent of GDP and the revised one is 11.2 per cent of GDP. And, in the coming fiscal year it is 13 per cent of GDP.
The targeted GDP growth is 7.4 per cent and inflation rate is 5.5 per cent. The total ADP is Tk.1533.31 billions. The allocations of resources in terms of the percentage of total budget for the divisions of human development, and transport and communication are slightly higher from that of the outgoing fiscal year; but for the divisions of agriculture and rural development, and food and social safety are somewhat decreased.
East West University, Dhaka