It is unfortunate that healthy debates on budgets are a thing of the past. As it is, the concept of shadow cabinets have never really been in place and in the absence of a functional opposition in or outside parliament, the other side of the story hasn't been told.
Emerging from the wreckage, economists and think-tanks have differing views. Abul Barkat has said the budget size could realistically be four times the one presented by the finance minister, others , albeit in the minority, feel the same way. Still others are doubtful about the reality of 'ambition'. The Centre for Policy Dialogue (CPD) doesn't see any vision to rope in the Tk Tk 800 billion (80,000 crore) private sector investment needed to bolster the 7.2 per cent growth rate.
In the wake of reduced import duties, obligations to phase out supplementary duties, Dr. Mirza Azizul Islam, a former Finance Adviser, sees the 35 per cent contribution of the National Board of Revenue (NBR) in funding the budget as dependent on further taxing the existing taxpayers. For all the hype of extending the tax net, the tax - gross domestic product (GDP) ratio at 10 per cent plus is the third lowest in the world. And we are told that only 1.9 million out of the country's population have registered TIN certificates, 1.3 million of which submit returns. It makes distressing reading.
If 40 per cent of the population are in the poverty circle it leaves roughly 96 million as being able to at least eke out a living. Considering the adult population comprises half of this, there should be 48 million able taxpayers. Leaving out half, if that is the women population, it leaves us with 29 million, a gap that is incomprehensible by the most considerate standards.
But for reasons that have not been explained, the budget says nothing about how this will be achieved or indeed, why so much tax increases has been tucked away in the fine print. By keeping tax-free ceilings and thresholds unchanged and reducing the investment benefits drastically, existing taxpayers will be forking out much more. The premise that the current base of taxpayers can continue to subsidise those who don't pay is untenable and pushes the process back into the area of non-declaration and graft.
The government is proud of having raised incomes throughout the country. It follows naturally that taxation should follow suit and it is about time that the dithering over flat taxes for businesses are solved once for all for businesses and shops. Public debate is now required to understand how those claiming zero income are actually in business.
Grudgingly enough, even the government admits the wheels of the economy are kept turning by small businesses. They have their tax relief and are prospering , thereby increasing spending capacity. Then a firm stance on big business, with a sympathetic view to their demands is as much in order. Too often, they have been let off the hook through structuring whether it be for loan default or taxation. None of these helps.
(The writer may be reached at [email protected])