They also said that it did not reflect what measures would be taken if borrowers were unable to repay the stimulus
Experts at a webinar on Saturday said that the proposed budget for fiscal year 2021-22 did not provide any consolidated, comprehensive and transparent reporting for stimulus packages.
They also said that it did not reflect what measures would be taken if borrowers were unable to repay the stimulus.
The remarks were made during a webinar titled "The National Budget for 2021-22: Private Sector Perspective," jointly organized by International Business Forum of Bangladesh (IBFB) and Bangladesh Enterprise Institute (BEI).
Planning Minister MA Mannan attended as chief guest, while Towfiqul Islam Khan, senior research fellow of Centre for Policy Dialogue (CPD) presented the keynote at the webinar.
In his keynote, Khan said that this year's budget was very significant in many ways as it would define how the country will fight the pandemic in the next and it was also related to the journey of LDC graduation.
“But it could have focused more on LDC graduation and SDG action timing, and the 8th Five Year Plan. The pandemic did not give the opportunity to focus elsewhere as it is now the big elephant in the room,” said the senior CPD research fellow.
The fiscal measures of the budget are completely business friendly. Among them income tax, TDS, tax holiday is mentionable. Moreover, facilities have also been provided for import of raw materials and finished goods and local VAT and service duty, he also said.
However, the proposal to impose tax on mobile financial services, as well as private universities and medical colleges were not business-friendly.
Tk12,300 crore has been embarked for two programs – to combat Covid-19 and its economic shocks -- but no concrete agenda was presented for them, said the keynote speaker.
There is a need for transparent reporting on stimulus packages in FY22 and whether it needs to be extended, expanded and redesigned in view of the experiences from last year, Khan suggested.
Small and medium industries are most affected by the pandemic. But there is no clear plan on how to deliver the government-announced incentives quickly to them, he also said.
The proposed budget also needed to enhance coverage to credit guarantee schemes. The government should monitor the budget closely and make changes any time if needed, he added.
Planning Minister MA Mannan pointed out various problems especially in the implementation of the Annual Development Program (ADP.)
“We feel there are shortcomings in the ADP implementations. However, the situation is improving. Much has changed since I started working. I could not change everything overnight, but I am trying,” he added.
He also said that no one wants corruption but corruption still exists.
Most of the speakers at the webinar suggested how to bring rural entrepreneurs under the stimulus package.
Humayun Kabir, president of BEI said: "In Bangladesh's context, a private sector-focused budget is very necessary. The private sector is driving most of the economy of Bangladesh. That is why the budget and budget related issues affect the private sector."
Mohammad Abdul Mazid, former chairman of the National Board of Revenue (NBR), said that increasing reserves should be used to accelerate the national economy.
Mashrur Riaz, chairman of the Policy Exchange of Bangladesh, said that the budget did not prioritize the health sector more in the context of Covid-19.
Moreover, the private sector is facing challenges in lockdown again and again. So, 70-80% people need to be vaccinated immediately, he added.
Mohammad Mahfuz Kabir, research director of BIISS, said that the communications and infrastructure sectors have suffered a lot during the pandemic but the proposed budget didn’t mention it properly.
MS Siddiqui, vice-president of IBFB, said that some sectors have to pay up to 8% advance tax. In that case, the sector will have to make 35% profit at the end of the year otherwise it will be difficult to get the advance tax refund.
Humayun Rashid, president, IBFB and Managing Director of Energypac Power Generation Ltd, chaired and moderated the webinar.