Parliament passes Tk 5.23 trillion budget for FY20

Parliament has approved the Tk 5.23 trillion national budget for the upcoming fiscal year 2019-20, starting on Jul 1.

On Sunday, a parliamentary session began at 10am presided by Speaker Shirin Sharmin Chaudhury where MPs voiced their approval of the budget -- the first in the ruling Awami League’s third term in government.

The budget will be implemented from Monday, the first day of the 2019-20 fiscal year.

Finance Minister Mustafa Kamal placed his maiden budget in parliament before it on Sunday in presence of the leader of the parliament Prime Minister Sheikh Hasina and the deputy leader of the opposition Raushon Ershad.

On Jun 13, Finance Minister Mustafa Kamal presented his maiden budget of Tk 5.23 trillion in parliament, which is equivalent to 18.1 percent of the total GDP in the country.

The government allocated a Tk 2.11 trillion for development programme in the new budget, that is more than 22 percent of the revised outlay for the current fiscal year.

The implementation cost in the new budget is Tk 102.6 billion, which is more than 16 percent of the revised non-development budget for the last fiscal year.

At least Tk 601 billion will be spent on salaries and benefits of state officials, which is more than 19 percent of the gross non-development budget.

The budget sets out a revenue target of over Tk 3.77 trillion. More than Tk 3.25 trillion is expected to recovered by the National Board of Revenue.

The highest revenue collection -- Tk 1.23 trillion is targeted from value added tax, or VAT. The revenue collection target through VAT was Tk 1.1 trillion in the last budget. The target was later reduced to Tk 1 trillion in the revised budget.

The government expects to draw Tk 1.13 trillion in revenue from income taxes and tax on profits, up from Tk 0.9 trillion in the last revised budget.

Kamal also expects to rake in Tk 41.68 billion in foreign donations.

The government is not imposing any new tax but wants to reach the target of revenue collection by expanding the tax net, said the finance minister.

The overall deficit in the latest budget is about Tk 453.8 billion, which is equivalent to five percent of the GDP.

The finance minister expects to make up the deficit with foreign loans worth Tk 638 billion and domestic loans worth Tk 773 billion.

Kamal expects to  achieve 8.2 percent GDP growth while reining in the rate of inflation to 5.5 percent.

At least 255 lawmakers discussed the bill presented by the finance minister for 51 hours before its passage.