The finance division is unlikely to use in the budget documents for the next fiscal the data prepared by the Bangladesh Bureau of Statistics (BBS) taking the fiscal year (FY) 2005-06 as the new base year.
The reason for non-use of the data by the finance division is attributed to lower than expected estimates of some macro-economic indicators, according to a reliable source.
Key economic indicators like tax-GDP (gross domestic product) ratio, export-import performances as percentage of GDP, estimated using the new baseline data, have been found to be much lower in comparison with those of the previous fiscal (2012-13).
However, the planning minister some days back made projection about the gross national income (GNI) for the current fiscal on the new baseline. The BBS reviewed its baseline last year. It has used the new base year data while measuring the GDP and the GNI for the outgoing 2013-14.
Bangladesh's economy has expanded following inclusion of many economic activities in the new base year but not the revenue collection, export receipts and import expenditures.
The division, thus, is willing to present the key economic indicators, estimated on the basis of old baseline, in the next budget documents.
It has already asked the BBS to measure the GDP according to the old baseline to help it derive reasonably healthy economic indicators.
"How will we use the new base year when it shows the tax-GDP ratio at around 9.0 per cent against that of 11 per cent estimated using the old base year?" said a senior official at the finance division.
He said the new tax-to-GDP ratio will be equivalent to that estimated five years back.
However, economists argued that the problem is a transitional one and the government should use new data instead of old ones.
They said the government should identify the reasons behind the fall in the revenues in terms of GDP rather than using the old base year. Dr Zaid Bakht, director (research) at the Bangladesh Institute of Development Studies (BIDS), said if the government uses the old baseline to show higher rates of different indicators, it will not be meaningful.
"In my view, it'll not be meaningful," he said.
Dr Bakht said the real picture of the economy will not be reflected if the government uses the old baseline.
While commenting on the baseline issue, Dr Ahsan H Mansur, executive director at the Policy Research Institute of Bangladesh (PRI), said the finance division should not use the old base line data to estimate economic indicators.
He said the government should rather try to increase revenues as the economy has widened over time.
Dr Mansur said the NBR (National Board of Revenue) should impose taxes on the new economic activities.
He said: "In my mind, the efficiency level of NBR needs to be enhanced alongside its modernisation to keep pace with the growth rate of the economy."
Dr AK Enamul Haque, a renowned researcher at the Dhaka-based Economic Research Group, said Bangladesh now should have at least 8.0 million taxpayers considering its per capita income of around US$ 1,100.
"But, in fact, presently, we have around 1.0 million taxpayers," he said.
He said the NBR has been working on the wrong parameter with the objective of raising the revenues instead of increasing the number of eligible taxpayers.
Dr Selim Raihan, a professor at the Dhaka University said this is the transitional period in terms of base year changes for the GDP measurement, adding: "I don't find any reason why the government will use the data of old base year of 1995-96."
Dr Raihan, an expert in economic modelling, said: "In every economy, there will be some positive and negative indicators after revision of the GDP. For this reason, we cannot stop reviewing."
He said some indicators will be lower when the baseline is changed and it means that some mechanism is not working properly.
"We should hammer on the right thing, not base years," he commented.
