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WHAT IS BUDGET
• Budget is an estimate of income and expenditure for a set period of time.
• From the perspective of Bangladesh the most important issues that are going to impact middle and poor class people need to be discussed.
BUDGET SUMMARY (FY-14-15) Budget FY 2014-15 Growth (Y to Y)
Budget Size 2505.1 15.9%
Sources of Fund (fig in bn) Growth ( Y to Y)
Target Revenue 1829.1 16.8%
Budget Deficit 675.5 13.4%
Bank Borrowing 312.2 4.1%
External Borrowing 242.8 30.7%
Application of Fund (fig in bn) Growth (Y to Y)
Non Development Exp. 1,282.3 15.9%
Development Exp. 863.4 16.8%
Annual Development Plan 803.1 13.4%
Other Exp. 359.3 4.1%
Key Features of Budget
Personal Income Tax
Personal income tax threshold has been increased to Tk. 220,000 from 200,000 Corporate Tax
Tax for publicly traded mobile phone company has been increased from 35% to 40% Tax rate increased for cigarette companies
Good move public health
SOME MORE FEATURES
Black Money Whitening
The FY 2013-14 budget proposed extension of the scope for whitening undisclosed income for investment in the real estate
• Only Tk. 38 crores was received as tax as against the total whitened amount of Tk. 1,305 crores during 2009-2013
Import duty Import Duty
Has been reduced
from 3% to 2% on the import of capital goods
from 12% to 10% on raw materials Import Duty for essential goods
Full exemption of customs duties will continue.
Budget for Agriculture
Tk. 17,471 crores, which is 11.95% lower than budget
of FY2013
Subsidy is sufficient only for fertilizer. A higher subsidy may be needed for other agricultural inputs
Budget for Poultry Farms and Garments
Tax exemption for another two years; reduction of duties on raw materials and spare parts
The Budget proposes to reduce supplementary duty on
This is beneficial for domestic consumers.
woven fabrics from 30.0% to 20.0%
knitted fabrics from 45.0% to 30.0%,
track suits and other garments from 45.0% to 30.0%,
various clothing accessories form 60.0% to 45.0%.
Budget for Education
Initiatives to be taken to eradicate illiteracy by 2014Raise teacher-student ratioSet guidelines for inclusive education for
all Implement Primary Education Development
Program-3 (PEDP-3)Establish Primary Teacher Training
Institutes (PTIs)Establish of model schools at upazila levels
Impact on Overall Industry
The budget has proposed a number of measures to stimulate industrial Sector, which will
facilitate new investment and
help retain or improve competitiveness of different industries
Continuation of tax holiday will help industry to grow
(17 industrial undertakings, 17 physical infrastructure, jute goods, fabric & dyeing, poultry, fisheries, shrimp, fish etc.)
Impact on Pharmaceutical Company
Supplementary Duty (SD) has been proposed to reduce to 5% from 10%
Bangladesh pharmaceutical industry imports around 80%-90% of the raw materials. Therefore, reducing SD on raw materials and raw improve the Gross profit margin of the industry.
Impact on Power Sector
Tk. 9053 crore (17.2% of total allocation)
14.6% higher than in FY13 respectivelyA total of 54 projects will be
implemented in FY145 power generation plants to be
completed in FY14:capacity 1480