According to economist Dr Ahsan H Mansur, the government should reexamine its budget and trim the outlay by Tk 500 billion through expenditure-plan adjustments. Administrative costs, subsidies, and other government spending could be reduced, while bank borrowing should be limited to less than Tk 900 billion.
Dr Mansur, executive director of the Policy Research Institute of Bangladesh (PRI), strongly urged reconsidering these measures before the national budget for FY25 is passed. The budget, which was presented to Parliament last week, outlines Tk 1.375 trillion in bank borrowing.
In a presentation titled ‘Budget Insights: Challenges and Opportunities’ organised by the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI) and PRI, Dr Mansur also recommended reviewing the possibility of eliminating redundant ministries and agencies, such as the Ministry of Textiles & Jute.
While advocating for a combination of fiscal and monetary tightening, he urged the central bank to take three key measures: not monetise government debt, not provide liquidity lifelines to ailing banks, and maintain an overall tighter stance for stable exchange rates.
At the programme, MCCI President Kamran T Rahman said some aspects of the budget—such as not eliminating the cash transaction limit to avail corporate tax cuts, offering black money whitening scopes, and the minimum tax provisions—have disappointed businesses.
Habibullah N Karim, vice president of MCCI, moderated the event. Dr Mashiur Rahman, the prime minister’s economic affairs adviser, was the chief guest.
Regarding tax breaks for investors, he proposed forming an advisory body, as the National Board of Revenue (NBR) may not have the necessary resources for such decisions.
Adeeb H Khan, chairman of the MCCI Tariff and Taxation Subcommittee, presented on behalf of the chamber.
“Many companies may not meet the cash transaction threshold for availing the corporate tax cut, considering the country’s business practices,” he said.
He said the effective tax rate rises to 45 percent due to minimum tax provisions. The proposed budget does not provide tax incentives for publicly listed and non-listed mobile phone companies.
PRI Chairman Dr Zaidi Sattar said policy divergence is an important factor in Bangladesh. He pointed out a discrepancy: while the “Made in Bangladesh” concept is welcomed, “sale in Bangladesh” is not. He said the country currently relies more on protective tariffs than industry subsidies.
