The new budget proposed by finance minister AHM Mustafa Kamal has five new aspects: 1. Initiative to implement VAT law, 2. Crop insurance, 3. Harnessing the power and dynamism of the young, 4. Efforts to transform villages into towns and 5. Highlighting the government’s Delta plan.
At the budget speech, the finance minister said, to keep small and marginal traders outside VAT, turnover of up to Tk 5 million has been waived. For businesses which have turnover between Tk 5 million and Tk 30 million, the tax will be 4 percent. This was done to encourage SMEs.
This time, a six layer VAT system has been proposed, starting from 2 percent and going up to 15 percent.
To ease the pressure of tax on local businesses, the fixed rate is 5 percent. For medicines and petroleum products, VAT has been kept at 2.4 and 2 percent respectively.
While introducing crop insurance, the budget also talks of bringing poor women under insurance to increase women empowerment.
The government has also taken an initiative to start health insurance for government officials, workers and the general people. For the first time, a separate allocation of Tk 1 billion has been made for the young with the aim to harness their vigour and dynamism for the long term progress of the country.
Through this, the government is thinking of establishing 498 training centres and 111 academic training centres in upazilas.
At the same time, efforts are underway under the ‘my home my farm’ programme to establish 6 million poor families by 2020.
Under this project, 95,000 cooperatives have been formed so far with 21.233 million beneficiaries.
Through the delta plan, the government aims to ensure sustainable usage of water and prevent natural disasters created from water.
This is especially important since Bangladesh is at risk of climate change disasters.