Budget for 2016-17 fiscal year

MNA Editorial Desk: AMA Muhith, Finance minister, is set to place the national budget for the next fiscal year, 2016-17 at parliament on Thursday afternoon with a likely outlay of Tk. 340,605 crore (3.4 trillion) aiming to create more jobs, wooing investment and speeding up the implementation of a clutch of ‘transformational’ mega-projects.

Muhith will place his 8th successive budget as finance minister of the AL-led coalition that has been in power since 2009, and his own 10th overall, putting him in a tie with the late Saifur Rahman. Muhith is projected to start his demonstration using PowerPoint at 3pm.

Finance Ministry said that the new budget eyes a GDP growth target of 7.2 percent, up from the outgoing fiscal’s target of 7 percent. However, as per the provisional estimation of the BBS, the GDP growth is poised to reach 7.05 percent in the outgoing fiscal.

Bearing in mind the declining trend of inflation, the inflation target next year is likely to be 5.8 percent, against the outgoing fiscal’s 6.2 percent.

Officials said to carry forward Bangladesh’s dream of graduating to a middle income country by 2021, the finance minister in his budget speech would outline ways to put the country on a higher growth path for attaining 8 percent GDP growth by the end of the government’s tenure.

Job creation for over two million youths joining the workforce every year would receive attention, as job growth slowed in recent years. The finance minister would hold a post-budget press conference on Friday at 4:00 pm at Osmani Memorial Auditorium in the city, it was announced.

Budget session to continue till 28 July

The 11th assembly, also the budget session, of the 10th parliament will continue till 28 July. The pronouncement was taken at the 11th meeting of the business advisory committee of the existing parliament held at the parliament on Wednesday.

Deputy speaker M Fazle Rabbi Miah presided over the meeting. The session will remain adjourned from 1 July to 16 July for Eid-ul-Fitr. Throughout Ramadan, the session will start at 10:00am.

The conference also decided that the speaker would extend or decrease the working days of the present session. The session will start at 3:30pm on 2 June and finance minister will place the budget for 2016-17 fiscal. The meeting decided to hold discussion on budget for 45 hours.

Eyes on VAT

All eyes are on what Finance Minister AMA Muhith makes of the Value Added Tax (VAT) in the 2016-17 budget. The government wants to implement the new VAT law to boost revenue but traders have been protesting against that.

VAT has been at the center of all discussions in the last few months ahead of the budget. Will the new law imposing 15 percent VAT will be effectively dissolve the fixed rate ‘package VAT’ is what the Bangladesh business community is wondering.

Muhith, who spoke to the media about a lot of issues ahead of the budget, had been very careful to remain tight-lipped on the VAT issue.

“I will not say anything on this now,” is what he had told to media.

The Valued Added Tax and Supplementary Duty Act have been formulated in 2012, but are yet to be effective. The government wants to implement it now despite protests by traders.

The new law imposes a 15 percent VAT for all kind of businesses, whose annual turnover is more than Tk 3 million. The rest are exempted.

Businesses, however, are not ready to pay VAT at 15 percent. They want the ‘package’ system to stay, which imposes a fixed rate instead of taxing on individual sales.