TBT DESK: The proposed budget for the fiscal 2025-26, estimated at Tk 7.9 trillion is a contractionary one targeting realistic GDP growth and lower inflation at 8%, says Business Initiative Leading Development (BUILD) on Monday in its budget reaction.
The floating exchange rate has been announced considering high foreign exchange reserves at USD 27.4 billion, it said in a statement.
The budget has given a long term projection, sometimes up to 2030 showing optimism for future economic growth.
However, BUILD said, the country at the moment is in a transition towards LDC graduation, declining growth in agriculture (from 3.30% to 1.79%), lower investment to GDP ratio (29.38%), SDGs, uncertainty because of Reciprocal tariff by USA, also non-tariff barriers by neighbouring country.
The budget delineated about the introduction of Bangladesh Single Window (BSW) and services being provided by OSS of BIDA.
But, BUILD said, Investment Promotion Agencies (IPSs) have not yet been successful in creating confidence among investors.
Supportive uninterrupted utility services for which investors cannot run their industries in full capacity, the budget even has mentioned that there will not be any price hike of utilities but not given any security of supply of gas and electricity.
High interest rate and unavailability to bank loans, deteriorated law and order situation have been some of the discouraging factors for the investors. Business entrepreneurs waited for a strong commitment in that respect.
A good initiative has been introduced regarding future adjustment of Minimum Tax applicable on Mobile phone, tobacco, beverage (under subsection six of section 163 of ITA 2023), but the provision for 38 heads (clause 163(2)) still remains non-refundable will work as a burden to the private sector, BUILD said.
The budget has increased the tax free income limit for personal tax payers while at the same time, the budget has withdrawn the 5% slab which will increase the ultimate tax burden and individual fixed income earners will not be able to enjoy the benefits of the increased tax-free limit, BUILD said.
However, BUILD said, appreciation must be given to the Finance Adviser for a very precise and to the point Budget for the people of the country.