Star Business Report

The issues of poverty, the job market, small and medium enterprises, and coronavirus vaccinations have been underestimated in the budget proposed for the next fiscal year, said the South Asian Network on Economic Modeling (Sanem) yesterday.

“This would lead to limitations in formulating policies,” said the think-tank in its post-budget media briefing held virtually.

Selim Raihan, executive director of the Sanem, said there was a disconnect between the title of the budget -- Bangladesh Towards a Resilient Future Protecting Lives and Livelihoods -- and its content.

“This disconnect is due to the improper and inappropriate assessment of the Covid-19 situation.” He called the revenue target unrealistic.

The proposed budget has targeted to raise Tk 389,000 crore and elevate the revenue-to-GDP ratio to 11.3 per cent.

“The revenue-to-GDP ratio seems to be unrealistic and historically high,” said Prof Raihan, calling for revising it downwards.

In the current fiscal year, the revenue-to-GDP ratio would be around 8 per cent.

The finance minister has proposed to reduce taxes for many businesses, so the revenue target was not achievable, he said.

The think-tank pointed out that there had not been enough data collection about the pandemic situation from government organisations although statistics was very important to understand the ground reality.

The poverty rate has increased, and there has been a big crisis in the labour market. Micro, small and medium enterprises have suffered the most and have received the least amount of support.