DHAKA, June 12, 2020 (BSS) – Centre for Policy Dialogue (CPD) today lauded some points of the proposed budget for the fiscal 2020-21, urging to focus more on enhancing budget implementation capacity to mitigate the impact of COVID-19 and accelerate the country’s economy.
“COVID-19 has exposed the high cost of weak implementation capacity which CPD had drawn attention to over the successive budget presentations,” said CPD Executive Director Dr Fahmida Khatun while presenting the analysis of the national budget for the fiscal 2020-21 at an online press briefing here.
During a crisis like the COVID-19 pandemic, she said, the main objective should be supporting the poor and the affected people, instead of being too much concerned with GDP growth.
“Several countries have been facing negative growth which is natural during a pandemic. The focus should be on coping, adjustment and mitigation with a view to subsequently get on the recovery track,” she added.
In view of the evolving COVID-19 scenario, she said, the government should be ready, if required, to revisit the budget and undertake necessary corrective measures in view of realities on the ground.
Fahmida said the national budget for fiscal year 2020-21 has been announced at a time when the economy has been worst hit by the novel coronavirus pandemic ever in the history of Bangladesh.
She said the first online return submission will receive rebate of Taka 2,000 which will encourage digital transformation of tax department
“One page Tax Return form has been proposed for small taxpayers. The proposal will simplify the tax return form and may incentivize more individuals to submit return,” she added.
Fahmida said e-TIN has been made compulsory for Zilla Parishad Chairmen and Vice Chairmen and the initiative will improve transparency regarding the income of these elected people.
She mentioned that CPD has welcomed the rise in tax on motor car or jeep. “AIT has been raised by 50-67 percent for private cars, jeeps and microbus,” she added.
CPD also welcomed the VAT exemption on import, manufacturing and trading stage for 17 types of medical equipment including soapy alcohol, COVID-19 testing kits, PPE, 3-ply surgical masks, protective spectacles, goggles, and raw materials for hand sanitisers, surgical masks, and disinfectants.
Fahmida said that VAT reduction from 15 percent to 5 percent for manufacturing of potato flakes made of locally produced potatoes will help promote agro-related investment.
“Reduction of VAT from 15 percent to 5 percent for manufacturing maize starch – will help boost domestic maize production,” she added.
Fahmida said VAT exemption on agricultural machineries such as Power Ripper, Power Tiller operated Seeder, Combined Harvester and Rotary Tiller at the trading stage will encourage mechanization of agriculture.
CPD Distinguished Fellow Professor Mustafizur Rahman and Senior Research Fellow Towfiqul Islam Khan, among others, joined the press briefing.