CG should meticulously prepare next budget
Saturday, 24 May 2008

The caretaker government(CG) must take extra caution to prepare the national budget 2008-09 in such a way that the democratic administration does not find it embarrassed to implement it. Rates of growth in the agricultural sector should not continue to lag behind those in manufacturing and services as it did in 2007-08. It is still feared that high inflation could entrench itself since the central bank has not tightened monetary policy and is unlikely to do in the near future. There are also signs that domestic and foreign investments have weakened over recent months. Domestic investors have been reluctant to expand capacity, with many wary of attracting the attentions of the Anti-Corruption Commission that appears determined to investigate all cases of unexplained wealth. Unlike in the past, investments are being scrutinized by the ACC this time.  As top business leaders and academics admitted the existence of a huge black money in the economy, the government should offer further opportunities to legalize the same. The businessmen in the country have huge untaxed money. The government should think about how to bring the money under the tax net through investment. Earlier, successive governments had offered similar amnesty for the delinquents several times with the latest one in 2006-07 fiscal year. A number of big wigs have also been sued and punished for tax evasion by the present Caretaker Government. A total of Tk 4,603 crore from a stash of such undisclosed money, popularly known as black money, was legalized taking advantage of pecuniary amnesty in the 2005-06 fiscal year at a tax rate of 7.5 per cent penalty. Preparing the national budget for the next year will be a daunting task keeping the huge subsidy, size of ADP reliable, adequate loans to private sector and checking the inflation. The coming budget should ensure food security, continue subsidy in this sector.

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