The government is to set an ambitious revenue collection target of Tk4.33 trillion for the national budget of fiscal year (FY) 2022-23, comfortably the highest ever, although meeting this target has never been the point.
Bangladesh's national budget is set to be placed in parliament on 9 June 2022 for the next fiscal, 2022-23.
The size of the national budget is to be set at Tk6.77 trillion (Tk6,77,864 crore) which is 15.4% of the gross domestic product (GDP), sources at the finance ministry said.
The National Board of Revenue (NBR), a wing of the Internal Resources Division (IRD), usually collects revenue for the government.
The upcoming budget is set to have a Tk4.33 trillion revenue target that is Tk44,000 crore higher than the target in the budget for the current fiscal and 9.8% of the GDP.
That target has of course not been met – it never has been in the era of the expansionary budgets adopted by ex-finance minister, late AMA Muhith.
But that hasn't stopped them from expanding.
It goes to show Muhith's legacy is still very much alive in the country's governance.
Given the very low tax-GDP ratio, it is better to aim high and miss, than aim low, has been the driving philosophy to the approach.
Though the government is raising the revenue collection target for NBR, the margin of the missed targets of the revenue board has been widening over the last several fiscal years.
Lack of technical know-how of officials, friendly revenue collection approach and backdated technology are obstacles for the revenue board.
As per the calculation, the budget deficit would stand at Tk2.44 trillion that is 5.5% of GDP.
According to finance ministry sources, the government would borrow Tk1,28,341 crore from the domestic sources and Tk1,16,523 crore will be borrowed from abroad to meet the budget deficit, in the proposed budget.
Of the domestic borrowing, Tk93,889 crore would be borrowed from the banking system while Tk34,452 crore from savings certificates.