POST TIME: 22 June, 2019 00:00 00 AM
Speakers urge complete overhaul of budget system

Speakers urge complete overhaul of budget system

Civil society think tank Sushashoner Jonno Nagorik (Shujan) yesterday called for reforms in the budgetary system to ensure sustainable development in the country.

Shujan recommended this at a roundtable programme at Jatiya Press Club in Dhaka.

In its reaction to the proposed national budget for the 2019-20 fiscal year, Shujan said there was lack of accountability and democracy in maintaining the budgetary system. So, the system should be reformed, it added.

In his keynote speech, Rashed Al Mahmud Titumir, professor of development studies at Dhaka University, also echoed the charge of lack of accountability in the budgetary system. “After the proposed budget was announced, amendments were done through the bureaucracy without anyone being informed,” he added.

Rashed said the government has targeted revenue generation of Tk. 3.41 lakh crore through taxes in FY 2019-20, which was 75 per cent up from FY 2017-18. The proposed budget also targeted revenue through VAT of Tk. 1.105 lakh crore for the fiscal year.

“When only 10 per cent of the people pay income tax, the government has to rely on VAT to generate revenue. This will be a huge burden for the lower- and middle-income groups,” he added.

The generation of VAT has been increased by 380 per cent since 2009-10, he noted.

Titumir further said the government must find ways to measure taxes based on individuals’ income. But the dependence on VAT would create more discrimination because all the people—both rich and poor—have to pay a similar amount of tax for buying commodities, he added.

Shujan president M Hafiz Uddin Khan said the financial policy should be based on the three fundamental aspects of equity, human dignity and justice for good management of the economy.

Hafiz said Parliament did not discuss the issues of common people in the budget. But when independent economists analyse the issues, the government ignores them, he added.

Eminent economist Prof. Anu Muhammad said the trend of collecting taxes directly from the people was rising and it had increased six times over the past 10 years. He also suggested that government should introduce January-December or April-March as the fiscal year instead of June-July to boost development works.

“The budgetary funds are wasted due to the fiscal year beginning from June-July and development works are also hampered because of monsoon,” he said.

Shujan secretary Badiul Alam Majumder said before including any project in the budget, it should be analysed to see whether it would be beneficial for the people or not. He also said development should be mean developing the condition of commoners, but the proposed budget had failed to address the rise in income inequalities.