Revenue collection to fall short of target
NBR projects 13pc growth against targeted 21pc in FY07
Staff Correspondent
The National Board of Revenue (NBR) yesterday projected that revenue collections in the current fiscal year will see hardly a 13 percent growth against 21 percent targeted in the budget for FY 2006-07. The projection came at a meeting of fiscal and monetary coordination council chaired by Finance Adviser AB Mirza Azizul Islam. Terming the current revenue target ambitious, he said in no way would it be possible to attain that much growth. It would rather hover around the usual rate of 13 to 14 percent, he said. The adviser said the political unrest in the last couple of months might have accounted for the shortfall in revenue collection. The meeting discussed the overall economic situation including budget implementation, foreign aid and bank borrowing. NBR sources said taxes on some essential commodities including sugar had to be brought down from the rates set in the budget. As a result, the government will suffer a shortfall of Tk 1000 crore in revenues from these sectors. Besides, due to a huge number of pending tax-related cases, Tk 1,620 crore may not come into the government exchequer, said meeting sources. As per the NBR statistics, the revenue growth in July-January was 9.06 percent while it was 12.11 percent in the corresponding period of the last fiscal. At the meeting, the central bank expressed concern over the government's huge bank borrowing. It observed that the government's borrowing from the banks must be reined in, otherwise, it might lead to higher inflation. According to the central bank statistics, the government borrowed Tk 6,300 crore in July-December period of the current fiscal. But the amount came down to Tk 5,800 crore due to cautious fiscal measures of the present caretaker government. Bangladesh Bank (BB) said imports have not yet seen any drastic fall despite the anti-hoarding measures of the caretaker administration. But they might dip in the next two months. A steep decline in imports will leave negative impact on the price of essentials, the bank said and called on the adviser to raise the issue before the chief adviser so that immediate steps could be taken to that end. The meeting however observed that healthy amounts of foreign currency reserve, remittance, and export earnings bode well for the economy. According to the Bangladesh Bureau of Statistics (BBS), the inflation rate on point-to-point basis was 6.13 in December and 6.37 in November of FY 06-07. The foreign reserve reached $3.97 billion on 14 February 2007. It was $3.48 on June 30,2006. The exchange rate on 14 February 2007 was on average Tk 69 to the greenback while it was Tk 69.70 on June 30, 2006.
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