National budget for 2019-20: A citizen’s perspective
I am pretty shocked to see the size of the budget – it is too meagre given the fact we are claiming a middle-income status. The announced budget is 523,190 crore Taka which is only 18.1% of the GDP. When we are claiming a robust GDP of 2,885,872 crore Taka, then why not our budget size is at least 865,762 crore Taka — meaning at least 30% of the GDP? In many countries this size is more than 33% of the GDP. Even there are developed countries whose budget size is 40% of their GDPs. I am proposing to increase our budget size to no less than 750,000 crore Taka this fiscal year.
If the government is really keen and sincere in building quality human capital and create productive employment in the country then higher spending on education is a must. It is really depressing to see that our education budget is too meager. To make the country self-dependent there is no alternative but to build domestic human capital like that of China.
Health budget should be Taka 50,000 crore
No country has made significant progress towards universal health coverage (UHC) without increasing the extent to which its health system relies on public revenue sources. Framing the approach to health financing policy in this way places the health sector within the overall public budgeting system and underscores the crucial role that the budget plays, or should play, for UHC. Historically, health financing discussions have been largely driven by demands to raise revenues and find new sources of funds, with much less discussion of overall public sector financial management and budgeting issues.
In any country health system is indispensable in improving the population’s health status, providing protection against health-related financial threat and enhancing the health sector’s receptiveness to service seekers’ needs. An awareness of the fundamental principles of public budgeting is important for those who have an active interest in health financing for the reason that the budget is a major instrument for resource allocation. Strong public budgeting in health in the course of the development of plans is likely to improve certainty in the sector’s resources, which in turn enhances the probability that defined plans can be translated into policy action.
Isn’t it very shocking to see that our less important defence sector is getting 32,558 crore Taka as opposed to very vital sector like health is getting only 25,732 crore Taka. I am proposing to increase health budget to no less than 50,000 crore Taka while reducing the defence budget to no more than 20,000 crore Taka. It should be remembered that healthy body and healthy mind can create very productive workforce for a country, which is why higher spending on health sector is so imperative.
In the social security and welfare sector the allocation is set for 29,769 crore Taka. Isn’t it very insufficient when we are so concerned about reducing income inequality, which is .48 in Gini Coefficient as per HIES of 2016. The trend says, it might be about 0.5 now – which is alarming. One way of reducing inequality is to increase allocation for social security and welfare. I would propose to increase the allocation to minimum 50,000 crore Taka exclusively for the people entitled for safety-net services — the poor, excluded and marginalised. No other additional population of different category should be included in this allocation (like pension-holders).
Ceiling of taxable income
All these years Taka has got devalued. One US Dollar is now 84 Taka. Why has the finance minister not thought about increasing the ceiling of taxable income to 350,000 Taka for the male and 400,000 Taka the female? Please consider this proposition. If the previous ceilings (250,000 and 300,000 Taka for the male and female respectively) remain unchanged then the less earning people, who are mostly service-holders, still have to pay taxes from their salary sources, and as a result, the income disparity between rich and poor will continue to grow. If the taxable ceiling is increased then those who earn less will be exempted from tax and high earning people will have to pay more. This will reduce income equality to some degree.
It is also very unfortunate to see that the surcharged ceiling of the net-wealth has been increased to 3 crore Taka. Why such favour for the rich people? Will it reduce the wealth disparity between rich and poor? The government is consistently saying that it wants to reduce disparity between rich and poor, then why favour the rich? Please bring down the ceiling to the previous level.
The finance minister has said that he will gradually increase the taxable population. How? What measures are to be taken against those who can and want to evade taxes very easily? Doctors, lawyers, private teachers, etc who earn money through cash exchange and are free from paying taxes at source, should be brought under tax-net. This free-earning population ey are evading taxes. The government is not looking at them, but is strict on people whose monthly income is mere 20,834 Taka per month (250,000 Taka as taxable ceiling). Is it tax justice? Please reveal how progressive tax justice will be ensured. There is no problem for us to pay taxes, but we want service and privileges. For example, I am absolutely a first class tax payer, but I get no service at all form any service institutions. Why? Please ensure some defined priorities and privileges for those who are sincere in paying tax.
Investment in Sanchayapatra should be encouraged
The finance minister wants to make TIN mandatory for all who wants to invest money in Sanchayapatra. How come thousands of small rural entrepreneurs, who are actually augmenting our economy, can go for TINs? The complexities in getting TINs will discourage small entrepreneurs to invest money in Sanchayapatra and thus the government will be deprived of borrowing from common people’s investment (savings).
Sanchayapatra (also known as savings certificates; savings instruments) are widely regarded as risk-free investments in Bangladesh and are a part of the savings mobilization scheme of the Government. Any Bangladeshi citizen can buy the appropriate Sanchayapatra conforming to the rules and regulations imposed by the Government.
For reducing bank borrowing, which is very costly, the government should encourage investment in Sanchai Patra and other savings schemes, so that, on the one hand, poor people can have some kind of security in their lives — and on the other hand, the government can utilise the savings amount in case of borrowing. Please exempt TIN for those who want to invest 3 lakh Taka in Sanchai Patra, especially for women investors. It will be judicious to give women-entrepreneurs to grow and thrive — this is an encouraging trend in our country.
All these expectations are possible if we can ensure tax-justice and good-governance in the country. What a pity, only 32% of the population pays taxes in Bangladesh – a major portion of whom belong to middle-income group and poor people who are bound to pay taxes at source, while the richer section evades taxes, capitalising the mall-governance of the revenue generating institutions.
Hope the government will take into account the propositions and observations made here and seriously revise the proposed budget for the benefit of poor and middle-class and for sincerely reducing inequality in the country.
I hope the Finance Minister will look into these matters and do the needful.
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