Former chairman of National Board of Revenue (NBR) Dr Mohammad Abdul Majid has said the economy is bracing new challenges and the budget must not be conventional, it should have focused measures to overcome these challenges. While speaking to The Daily Observer on “What We Want In Fiscal Budget,” he said mere presentation of a budget is not enough; it must be implementable. In every step we must be mindful that budget is an effective tool to distribute resources among various segments of the economy as part of building the nation. It can’t be just an income and expenditure statement, Abdul Majid said. He said every new budget can’t be like the previous one; there must be new outlook and policy options to address new issues for change. He said Bangladesh is poised to become a middle-income nation soon and the budget must pave the way. In this case new projects in the budget must be selected to that goal from the list of five-year plans’ priorities. What we need here is to avoid higher cost estimate of projects which many vested quarters force upon the budget to serve their interest. Political pressure groups and part of bureaucracy always want to include some projects in the budget thus corrupting the entire budgetary system. They benefit from unnecessary procurements or unnecessary tours abroad. Budget provides unbridled way of making fortune. As the size of the budget is getting bigger every year, the scope of corruption is also getting larger. The new budget must take these issues seriously, he said. He said stable political situation is key to achieving budgetary goals. This is here now but the budget must strengthen efforts to increase capacity of the government leaders and efficiency of bureaucracy to deal with a bigger budget. On fiscal matter he said tax and tariff must be fixed properly. It should make sure it will bring necessary revenue for growing expenditure of the government but in no way overload business with various charges that may hinder trade and investment. Majid said a big revenue target is not always a good option. Revenue collection depends on efficiency of taxmen. It will be bigger with a better performing economy. He said, “If incomes increase, income tax will increase; if people buy and sell more, VAT collections will go up; if people export and import more, the government will get more duty.”Majid said if the economy is not dynamic, revenues target will face setback. He said, the Finance Minister need to be cautious that the budget must effectively deal with trade and investment issues. It should have enough allocations for attaining SDGs, more allocations for health, education, human development, sanitation and to reduce women mortality at birth. Export diversification must have enough incentives. He said the Annual Development Programme (ADP) should have targeted projects without being overloaded by unnecessary projects. Project implementation will be better attained with lesser number of projects in the ADP He said government expenditure almost routinely exceeds revenue earnings. It pushes the government to bank borrowing and this in turn is causing liquidity crisis in banks. Private sector is not getting enough loans. Private investment is thus suffering to cause setback to new job creation. He said, “We will have to come out of the mentality of taking up lot of projects in ADP to please some people eventually destroying budgetary discipline. Big budget does not mean big development. Rather budget should be properly planned to be implementable. Time and cost over-run in some project always affect implementation of other projects forcing many to lose allocation in midterm review. Mega projects have virtually stalled progress of other projects. “An aggressive budget with big projects and ambitious expenditure” stands in direct conflict with pragmatic budgetary exercise. In an election year, the government often resorts to it to support the election agenda. Most money thus spends ends up in misuse. The election is now over and the finance minister must not allow unnecessary borrowing and let budgetary deficit go above 5 percent of the GDP. The government must plug misuse of fund and big corruption to derive the real value public money, he said.
