Parliament on Wednesday passed the national budget for 2011-2012 with an outlay of Tk 1,63,589 crore and a massive deficit of Tk 45,204 crore, by approving the Appropriation Bill 2011.
Finance minister Abul Maal Abdul Muhith, who placed the fiscal measures on June 9 for the next financial year beginning on Friday, piloted the Appropriation Bill in the parliament which was passed by voice vote after a brief discussion in the absence of the main opposition BNP which was boycotting the current session.
The government in the budget, which many economists termed 'ambitious' and 'full of challenges', targets to borrow Tk 13,058 crore from foreign sources and Tk 27,208 crore internally to meet the budget deficit which is 5 per cent of the gross domestic product estimated at Tk 8,99,670 crore in the 2011-12 financial year.
The passage of the budget began on Wednesday with the ratification of the demand resolution.
Ministers of the ministries concerned placed their proposals for expenditure through 54 demands for grants, which were passed by voice vote.
About 600 cut motions were proposed by opposition members but only an independent lawmaker Fazlul Azim spoke on seven proposals. Since other members of the opposition were absent, their cut motions were not placed.
Later, the cut motions were rejected by voice vote.
After the passage of the demand resolutions, the treasury bench members passed the Appropriation Bill 2010 by approving the demands for grants and appropriation of Tk 2,32,464.08 crore from consolidated fund for different ministries and bodies for the next financial year ending June 30, 2012, completing the passage of the budget.
Parliament on Tuesday passed the Finance Bill 2011 which legalises all tax proposals made in the budget.
Muhith earlier on June 9 placed the budget proposing to spend Tk 1,02,903 crore on non-development sector, including Tk 16,519 crore to repay internal debts and Tk 1,478 crore to pay interests on foreign loans, and Tk 50,642 crore on development activities.
The budget projected a revenue earning of Tk 1,18,385 crore, or 13.2 per cent of the GDP, comprising Tk 91,870 crore collected by the National Board of Revenue in taxes and duties, non-NBR tax revenue of Tk 3,915 crore, and Tk 22,600 crore non-tax revenue. The revenue target is 24.37 per cent higher than the targeted revenue collection in the revised budget for the outgoing financial year.
Although the finance minister set a target of borrowing Tk 18,957 crore from the banking system to meet a part of the yawning budget deficit, he said that the government might have to go for reducing money supply and private-sector credit growth to rein in soaring inflation.
Muhith, while presenting the budget in the house on June 9, expressed hopes to bring down inflation to 7.5 per cent in the next financial year from 10.7 per cent recorded in April but downsized both allocation and subsidy for the agricultural sector.
He also set a target of achieving a 7 per cent GDP growth, compared to the 6.7 per cent growth target in the outgoing financial year.
Muhith also proposed an ambitious annual development programme of Tk 46,000 crore despite poor implementation of this year's revised ADP of Tk 35,880 crore.
The minister in the Finance Bill passed on Tuesday evening amended his proposed tax measures almost entirely in line with the recommendations of the prime minister.
According to the Finance Bill, investment of undisclosed money will be allowed in stock market, along with treasury bond and infrastructure development find, by paying a 10 per cent tax.
The government also slashed the proposed 1.5 per cent tax on export proceeds to 0.6-0.7 per cent.
The government also reduced proposed tax at source on registration of commercial flats and spaces, withdrew tax on poultry sector, cut tax on tobacco companies and rationalised rates of premium on different types of saving certificates.
The government also extended the facility of tax holiday for poultry industries until 2013.
Muhith in his budget speech earlier proposed a five per cent tax on the sector and withdrew tax holiday facility.
He, however, amended the finance bill keeping the sector out of tax net as it was generating employment and meeting the demand for protein diet.
Muhith also announced reduction of income tax at source for registration of commercial flats and spaces to almost one third of the amount originally proposed.
As for tobacco manufacturing companies, the government announced a 42.5 per cent income tax cut from the originally proposed 45 per cent for non-listed companies in share market. For listed tobacco companies, it imposed income tax at a rate of 35 per cent.
The government also reduced duty on luxurious double cabin pick-ups and supplementary duty on 1001cc to 1500cc vehicles to 30 per cent from the proposed 45 per cent.
The government also raised the ceiling of tax-free income of individuals to Tk 1.8 lakh from Tk 1.65 lakh, extended tax holiday facilities for industries by two years, and slashed value-added tax on mobile SIM cards to Tk 600 from Tk 800.
Source : New Age