MoF statement gives mixed signals
FE Report | Wednesday, 16 March 2011
FE Report
The target of the National Board of Revenue (NBR) for revenue collections in fiscal 2010-11 will be revised upward by, at least, Taka 10 billion. The original budgetary projection about the NBR-portion of revenue earnings was set at Taka 725.9 billion. About 80 per cent of the government"s aggregate revenue earnings are collected by the NBR. The revised amount of the NBR part of the revenue earnings has been estimated at Taka 735.9 billion. This is indicated by the updated statement on the state of the macro-economy and the budgetary development in the first half of the current fiscal, prepared by the ministry of finance (MoF). The statement is upbeat about the healthy growth of revenue earnings of the government. But it also shows a rising revenue expenditure pattern in the current fiscal. The entire assessment of the additional revenue collection in the current fiscal, as indicated by the MoF"s statement, will go for funding the agriculture subsidy bill. The revised estimate shows that this subsidy bill will go up from Taka 40 billion to Taka 50 billion in fiscal 2010-11. The revenue collection by NBR in the first half of the current fiscal stood at Tk 335.5 billion posting a 27.1 per cent growth over the same period of the previous fiscal year, according to the data in the statement of the MoF. The statement, however, indicated the target about aggregate revenue earnings, from both NBR and non-NBR sources, set originally for the current fiscal year will remain unchanged in the revised budget. The original target of non-NBR revenue collections will be trimmed by Tk 2.0 billion and non-tax revenue by Tk 8.0 billion in the revised one. About the agri-subsidy bill, the statement noted: "The amount of agriculture subsidy in the revised budget may be increased to Tk 50 billion from Tk 40 billion, allocated under the original budget, to make the agriculture inputs available to poor at affordable rates." It said the government has lowered the prices of different categories of fertilisers on three occasions during the first six months of the current fiscal. The statement also gives a disconcerting picture about the country"s overall balance of payments (BoP) position. It stated that the foreign currency reserve at the end of the current fiscal year might decline, in the wake of price-spike of food and fuel in the international markets, coupled with increased public-private investment in the country. The foreign currency reserve of the country was at $11.20 billion at the end of December, 2010. The statement said the agriculture credit disbursement posted an 11 per cent growth, export earnings 41 per cent and import payments by 36 per cent during the first half of the current fiscal compared to those respectively during the same period of the previous fiscal. The overall economic situation in the coming months would improve further because of higher volume of investments, as is indicated by higher growth of import of capital machinery and industrial raw materials during the first half of the current fiscal, the MoF observed in its statement. The import of capital machinery recorded a 46 per cent growth and that of raw materials, 35 per cent growth during July-December period of the current fiscal year compared to the situation a year back, the statement mentioned. The overall public expenditure-development and non-development -- marked a 20 per cent rise in the first half of the current fiscal over that of the corresponding period of the previous fiscal, according the statement. The expenditure under the Annual Development Programme was Tk 102.9 billion, during July-December period of the current fiscal year, the amount being 27 per cent of total annual allocation, it pointed out.
The target of the National Board of Revenue (NBR) for revenue collections in fiscal 2010-11 will be revised upward by, at least, Taka 10 billion. The original budgetary projection about the NBR-portion of revenue earnings was set at Taka 725.9 billion. About 80 per cent of the government"s aggregate revenue earnings are collected by the NBR. The revised amount of the NBR part of the revenue earnings has been estimated at Taka 735.9 billion. This is indicated by the updated statement on the state of the macro-economy and the budgetary development in the first half of the current fiscal, prepared by the ministry of finance (MoF). The statement is upbeat about the healthy growth of revenue earnings of the government. But it also shows a rising revenue expenditure pattern in the current fiscal. The entire assessment of the additional revenue collection in the current fiscal, as indicated by the MoF"s statement, will go for funding the agriculture subsidy bill. The revised estimate shows that this subsidy bill will go up from Taka 40 billion to Taka 50 billion in fiscal 2010-11. The revenue collection by NBR in the first half of the current fiscal stood at Tk 335.5 billion posting a 27.1 per cent growth over the same period of the previous fiscal year, according to the data in the statement of the MoF. The statement, however, indicated the target about aggregate revenue earnings, from both NBR and non-NBR sources, set originally for the current fiscal year will remain unchanged in the revised budget. The original target of non-NBR revenue collections will be trimmed by Tk 2.0 billion and non-tax revenue by Tk 8.0 billion in the revised one. About the agri-subsidy bill, the statement noted: "The amount of agriculture subsidy in the revised budget may be increased to Tk 50 billion from Tk 40 billion, allocated under the original budget, to make the agriculture inputs available to poor at affordable rates." It said the government has lowered the prices of different categories of fertilisers on three occasions during the first six months of the current fiscal. The statement also gives a disconcerting picture about the country"s overall balance of payments (BoP) position. It stated that the foreign currency reserve at the end of the current fiscal year might decline, in the wake of price-spike of food and fuel in the international markets, coupled with increased public-private investment in the country. The foreign currency reserve of the country was at $11.20 billion at the end of December, 2010. The statement said the agriculture credit disbursement posted an 11 per cent growth, export earnings 41 per cent and import payments by 36 per cent during the first half of the current fiscal compared to those respectively during the same period of the previous fiscal. The overall economic situation in the coming months would improve further because of higher volume of investments, as is indicated by higher growth of import of capital machinery and industrial raw materials during the first half of the current fiscal, the MoF observed in its statement. The import of capital machinery recorded a 46 per cent growth and that of raw materials, 35 per cent growth during July-December period of the current fiscal year compared to the situation a year back, the statement mentioned. The overall public expenditure-development and non-development -- marked a 20 per cent rise in the first half of the current fiscal over that of the corresponding period of the previous fiscal, according the statement. The expenditure under the Annual Development Programme was Tk 102.9 billion, during July-December period of the current fiscal year, the amount being 27 per cent of total annual allocation, it pointed out.