JS passes budget for FY11
ET Report

The Jatiya Sangsad, in the absence of the main opposition BNP, has passed the budget for the fiscal year 2010-11 while the main challenge lies in its implementation, containing inflation and achieving higher GDP growth.
The budget, the second by this Awami League government to be implemented from July 1, outlines Tk 1, 99,873 crore gross expenditure including revenue and development, and Tk 1,32,170 crore of net expenditure.
Among 53 ministries and divisions, the defence ministry has received the maximum allocation of Tk 10,694 crore.
The education ministry received the second highest allocation of Tk 9,885 crore followed by the local government division with an allocation of Tk 9,724 crore.
Besides, the primary and mass education ministry, health and family welfare ministry and food division under food and disaster management ministry got an allocation of more than Tk 8,000 crore each.
This time, the government in the budget presented a road map for the power sector to solve severe power crisis and a concept paper on district budget.
The parliament has also passed the finance bill 2010 with some changes in the original proposals.
The proposal to deduct tax at the rate of 10 per cent from the interest on any income of women and pensioners from the government savings tools was withdrawn while tax at source on the commission of the members of the stock exchanges was reduced to 0.05 per cent from the proposed 0.1 per cent.
The proposal to reduce the duty rate on cars having capacity between 1501 and 1650 cc was withdrawn.
The other major changes are reduction in export sector tax at source from 1.0 per cent to 0.5 per cent and VAT at business level from 3.0 per cent to 2.0 per cent, withdrawal of duty on hearing aid, retention of 5.0 per cent regulatory duty on milk powder and duty withdrawal of import of dates.
Income tax of stevedoring agencies, C&F agents and private security service providers was reduced from 15 per cent to 10 per cent.
A portion of revenue exceeding the targeted amount will be distributed among the taxmen as incentive, the finance minister announced Finance minister in his speech said duty imposed on sugar would be applicable after Ramadan, when the essential is heavily consumed.
Many lawmakers and other stakeholders proposed to reduce duty on mobile sets but it is not possible at this time, Mr Muhith told the JS.
It is also not possible to consider more incentives for shipbuilding and salt industry or emission based duty on vehicles in the budget for 2010-11, he said.
"The issue will be discussed later with the stakeholders," he added.
Mr Muhith said the government wants to increase revenue and the income tax department would be expanded.
"We want to expand tax net and it will be hassle-free and without any complicacy to encourage the taxpayers to pay more taxes," he said at the parliament.
Muhith said through this plan people can make the government accountable. "We expect to implement the district budget successfully during the tenure of the present government."
The finance minister also said that he is doubtful about proper implementation of the budget. However, he expressed the hope of achieving more progress this year.
About inflation, Muhith in his speech presented a picture of local and international scenarios and hoped that inflation would remain within the target of 6.5 percent.
As the BNP remained absent their cut motion proposals were not placed in the House yesterday. Only a few proposals by independent lawmaker Fazlul Azim were placed.
The finance bill was placed with the budget to bring changes in The Excise & Salt Act, 1944, The Customs Act, 1969, Income-Tax Ordinance, 1984 and Value Addition Tax Act, 1991.
The bill proposed that a company will have to pay tax at 10 per cent on share trading income, five per cent tax on income of sponsor shareholders or directors of a listed company and three per cent on the premium value of shares of companies being sold at premium value.
The minister proposed to collect tax at source from real estate developers at the time of registration of flat or building at a rate Tk 2,000 or Tk 800 depending on locations.
The National Board of Revenue will introduce spot assessment system and expand coverage of on-going survey to net new taxpayers through outsourcing, the minister proposed.
The NBR will set up Large Taxpayers Unit (LTU) in Chittagong by next fiscal year and a limited number of the highest taxpayers will get tax cards.