Finance Minister Abul Hasan Mahmud Ali proposed a budget of around Tk 8 lakh crore for the financial year 2024-25 in the National Parliament. This year’s budget speech is titled ‘Commitment to build a happy, prosperous, developed and smart Bangladesh’.

Generally, after the discussion in the parliament on the proposed budget, in some cases, there are no major changes, even if there are amendments. Let’s take a look at eight aspects of the new budget.

1. income tax

In the budget, everyone’s eyes are on income tax. This is especially important for those who are employed. As seen in the proposed budget, there has been no change in the tax-free income limit.

This time some changes have been made in the field of taxation. Those with higher income will have to pay more income tax. In this year’s budget, the maximum tax rate has been fixed at 30 percent. 30 percent income tax will be applicable for those whose total annual income is more than 38 lakh 50 thousand rupees.

That is, if the income is more than 38 lakh 50 thousand rupees, 30 percent tax has to be paid on that income.

2. Revenue and Development Budget

A budget has two parts. One part is the revenue budget and the other is the development budget. The expenditure estimated every year for the administration of the state and the money collected by the government from various taxes is called the revenue budget.

Apart from this, the expenditure for various types of development work including infrastructure is called development budget. Out of the proposed budget of about eight lakh crore rupees, the revenue budget is 5 lakh 32 thousand crore rupees.

That is, this money will be spent on state management. Which includes various issues including salaries and allowances of state officials and employees. The development budget is two lakh 65 thousand crores. The largest allocation in the development budget is in the transport and communication sector, which is around Tk 71 thousand crore.

3. Which sector has the highest allocation?

As seen in the budget presented by the government, the largest expenditure will be on debt interest payments. About 14.2 percent of the budget of 8 lakh crore rupees will be spent on loan interest payments, amounting to 1 lakh 13 thousand crore rupees.

In the proposed budget, the education and technology sector has been given the most importance. 14 percent of the total budget is proposed to be spent on this sector. The total amount of which is 1 lakh 12 thousand crores.

11.1 percent of the total budget will be spent on subsidies and incentives in various sectors, amounting to more than 88 thousand crore rupees. Besides, 10.2 percent will be spent on transport and communication sector, amounting to more than 81 thousand crore rupees.

4. Where will the money come from?

In the proposed budget, the government has set a revenue target of around five and a half lakh crore. The remaining two lakh 56 thousand crore rupees will be borrowed by the government. This includes sale of savings bonds, sale of various types of bonds and borrowing from banks and financial institutions.

95 thousand crores will take loans and grants from foreign sources. and as much as Rs.1 lakh 61 thousand crores from internal sources. Of this, the National Board of Revenue will collect 4 lakh 80 thousand crores of tax. Methods of collection include VAT, import duty, income tax, supplementary duty.

5. Keeping money in the bank will increase the cost

Excise duty of 3 thousand taka has to be paid if there is 10 lakh taka to 50 lakh taka in the bank. If 50 lakhs from 1 to 1 crore in the bank, you have to pay 5000 taka. Excise duty of Tk 10,000 should be paid if there is between Tk 1 crore and Tk 2 crore in the bank. Besides, if the amount is from 2 crore to 5 crore rupees, the excise duty will be 20 thousand rupees.

6. Community Center, Mobile Phone

If you want to organize a wedding, birthday or any event at a community center or convention center, you need to show an income tax return. No event can be organized in the community center without proof of income tax return.

A person can bring a maximum of two used phone sets duty free while coming from abroad. Besides this he can bring a new phone set on payment of duty.

7. Duty on import of cars of MPs

Members of parliament in Bangladesh have been importing cars from abroad duty-free for so many years. But in this year’s proposed budget, the finance minister has proposed to levy a duty on the import of MPs’ cars.

In that case, it has been proposed to levy 25 percent duty on car import and 25 percent VAT at the import level. He said in his budget speech, everyone is encouraged to pay revenue to come out of the culture of tax avoidance at all levels.

“To set a shining example of leading from the front as a representative of the people, changing the right of MPs to import cars without paying all kinds of customs duties will set a great example.”

8. Laundering of black money and assets

The proposed budget calls for whitening black money and legalizing undisclosed wealth by taxing it at fixed rates. For example, if a person has concealed his plot or flat, he can legalize it by paying a fixed rate of tax. On the other hand, in case of undisclosed amount, it can be legalized by levying 15 percent tax. Economists describe assets that are not shown in income tax files as black money or wealth. Source: BBC

Business Bangladesh/AK