CPD criticises FY25 budget for ‘lack of innovation’, urges reconsideration of dirty money policy

The think tank’s executive director Fahmida Khatun says that a traditional budget cannot solve problems in such a difficult period

The Centre for Policy Dialogue or CPD has criticised the proposed national budget for the fiscal year 2024-2025, saying it lacks innovation and clear directives to address economic challenges.

Reacting to the budget proposal unveiled on Thursday, CPD Executive Director Fahmida Khatun said she believes the plan to allow citizens legalise undisclosed income is “unjustifiable”.

"Given the challenging time, we expected this budget to be more innovative. We hoped for bold steps because a traditional budget cannot solve problems in such a difficult period," she remarked.

Fahmida said the budget for the next fiscal year appears to be “another budget from the past”.

"The current economic situation and transitional crises required appropriate steps and clear directives, which this budget did not provide," she added.

"For example, taxes have been imposed on locally produced juices, mobile phone talk time, and entry fees for amusement and theme parks. Ultimately, these costs will be borne by consumers."

"The cost of living is rising due to inflationary pressures, and additional taxes or similar measures will further burden people," said the think tank’s executive director.

'THE GOALS LACK A TOUCH OF REALITY'

Fahmida highlighted the target for average inflation in the proposed budget has been set at 6.5 percent, despite the key economic index currently hovering above 9 percent, and nearly reaching 10 percent over the past 24 months.

"Reducing inflation to just over 6.5 percent within a year will be a challenge, and it seems to us that these targets are unrealistic."

'MONEY WHITENING AT 15% TAX UNETHICAL'

The government has reintroduced the opportunity for citizens to legalise their undisclosed income, or black money, by paying a 15 percent tax on immovable properties without facing inquiries about the source of their income.

The CPD executive director has called for a review of the latest budgetary provision.

"Black money can be whitened by paying 15 percent tax, and it's not even open to question. We have consistently argued at CPD that it is neither ethically nor economically justifiable. Moreover, it doesn't uphold social justice," she said.

According to her, such measures are taken considering special interest groups, but not much of a significant influx has been seen; a lot of money did not actually come in. She believes it should be reconsidered.

TIB CALLS FOR THE WITHDRAWAL OF THE OPPORTUNITY

Transparency International Bangladesh, TIB, expressed surprise and dismay at the reintroduction of the “unethical” opportunity to legalise undisclosed money in the budget.

Its Executive Director Ifetkharuzzaman stated: "By providing such an opportunity to legalise black money, the government is essentially encouraging corruption and illegal wealth accumulation.

“Simply put, the government is indirectly inviting citizens to engage in corruption by guaranteeing impunity."

Iftekharuzzaman hopes that this process of legitimising corruption will be permanently stopped.