The national budget for fiscal 2019-20 is going to get final approval in the national parliament today (Sunday). Some remarkable changes in Income Tax, VAT etc, with measures to ensure welfare of middle class people, business community and development of capital market, are also likely to come. Concerned sources said, the government has kept the issue of protecting the poor through implementing various projects and programmes in serious consideration, in giving final approval of the budget proposal.
Earlier on June 13, Finance Minister Mustafa Kamal unveiled a Taka 5,23,190 crore national budget for 2019-20 in the Jatiya Sangsad setting the GDP growth target at 8.2 percent, and with clear indication to transform the country into a role model of a modern and welfare state by 2041. In the last two weeks, stakeholders, experts, analysts and bodies concerned, have made recommendations and suggestions to bring some changes in a number of potential sectors, before the final approval of the budget targeting to ensure economic growth through easing business and commercial activities.
Following the recommendations and suggestions, the government is now going to withdraw advance tax that was imposed newly on import of capital machinery and raw materials, and even the rate of VAT and Tax on rod and steel products may also come down. It is expected that the tax, imposed on stock dividend of capital market may also come down and tax rebate may be under some heads including e-commerce.
In the draft budget, the finance minister proposed increasing the tax at source to 10 percent on savings tools from the existing 5 percent, which drew huge criticism as it could hurt the deposits of middle class people. However, ministry sources said, it is yet undecided whether the tax is to be withdrawn from all types of savings tools or family-based and pensioners’ deposits. As it is yet undecided, the prime minister will make the final decision on the issue, they said.
National Board of Revenue sources said, the 7 percent Value-added Tax, the proposed budget imposed on the social media based e-commerce business, might be reduced while being passed on June 30. The finance minister, in line with a move to expand the country’s tax net, made the Tax Identification Number (TIN) mandatory in the proposed budget for getting electricity connections in the residential holdings in the city corporation areas.
Meanwhile the lawmakers, while taking part in the general discussion on the final day on the national budget in the Jatiya Sangsad, said the budget will cut poverty gradually and reach the country to a middle income one by 2021, and a developed one by 2041. It is usual that the proposed budget outlay is bigger in size as Taka 74,000 crore has been earmarked for the social safety net programme, the proposed budget is not a conventional one at all, but it is placed for the development of the poor people, , they said.
Lawmakers observed that the budget that over the years had now reached Taka 5,23,190 crore, was of Taka 1,13,170 crore in 2009-10 fiscal led by Prime Minister Sheikh Hasina, while the budgetary allocation during the BNP-Jamaat regime was only Taka 64,000.Discussing the proposed budget, Minister for Foreign Affairs AK Abdul Momen expected that the implementation of the proposed budget will cut the poverty rate by 5 per cent in the next five years, adding that the realization of all the previous budgets had effectively slashed the poverty rate at 21 per cent from its earlier level of 41 per cent.
Terming the proposed budget as ‘humanitarian development budget’ the foreign minister said, all the new projects and programmes including ‘Ekti Bari Ekti Khamar’, ‘all villages would be towns’, ‘Ashrayan’ and social safety net programmes taken up by Prime Minister Sheikh Hasina have changed the eco-social situation of the country.The rate of the extreme poor has already declined due to the initiative by Prime Minister Sheikh Hasina, said former Food Minister Qamrul Islam, noting that the proposed budget would help cut the extreme poverty rate in the next five years.
The government in order to encourage the listed companies to offer cash dividends to the general investors, imposed 15 percent tax on the profit of stock dividends in the proposed budget.Ministry sources said, this decision might also be changed in the conclusive budget. The new VAT law in the budget imposed 5 percent Advance Tax (AT) instead of Advance Trade VAT (ATV) on the import of capital machinery.
