The International Monetary Fund (IMF) has relaxed several targets including foreign exchange reserves, revenue collection, automatic price adjustment of fuel for the $4.70 billion loan package for Bangladesh. At the beginning of this year, the IMF had set forex reserves target at $25.34 billion by September and $26.81 billion by June next year as conditions for the loan package. According to BPM6 – reserve calculation method – Bangladesh’s forex reserves stand at $21.15 billion. Bangladesh urged IMF to downsize required reserves to $20 billion for next loan instalment, says official On a net basis, this amount has further decreased to below $18 billion. In this situation, the Finance Division officials requested the IMF to relax the target for forex reserves. Considering the request, the IMF has relaxed the target. Bangladesh has committed to keep the reserves at $18.4 billion at the end of December this year, and at $20 billion at the end of June next year. IMF delegation meets BGMEA President to discuss challenges and prospects of RMG sector Last Tuesday and Wednesday, the visiting IMF delegation discussed the issues with the relevant officials of the Finance Division of the Ministry of Finance. Sources in the Finance Division said that after discussion, IMF agreed on being flexible on some conditions. Finance Secretary Md. Khairuzzaman Majumder led the meeting on behalf of the government. The IMF mission was led by Rahul Anand, head of the IMF’s Asia-Pacific division. IMF team holds meeting with Power Division, discusses subsidy

Benapole Customs House has fallen short of its targeted revenue by Tk509 crore in the first six months of the current 2021-22 fiscal as the customs house collected about Tk1,991 crore against a target of Tk2,500 crore. However, Tk101 crore more was collected this time than the first six months of 2019-20 fiscal year. At that time the revenue collection target was Tk 1,889 crore. In the first six months of this year, 11,53,034 metric tonnes of goods have been imported which was 11,53,034  metric tonnes in the first six months of 2019-20 fiscal year. Besides, 2,76,003 metric tonnes have been exported this time which was 1,76,296 metric tonnes in the first half of 2019-20. Although imports have declined slightly compared to last year, exports have increased. According to Benapole Customs sources, the National Board of Revenue (NBR) has set a revenue target of Tk 6,245 crore for imported goods this year. Earlier, in the fiscal year 2020-21, the revenue target at Benapole port was Tk 6,244.62 crore. At the end of last fiscal year, Tk 4,143 crore was collected. Although the growth of revenue during the year was higher than other times, the deficit was Tk 2,057 crore. Besides, the shortfall was Tk 3,392 crore against the target in 2019-20 fiscal year while it was Tk1,145 crore in 2018-19 and Tk 179.64 crore in 2017-18. Can the target ever be achieved? Meanwhile, there are doubts in all sections about achieving the target of such a large amount this year. Experts said it is necessary to develop the infrastructure in customs and ports to expand trade in order to increase revenue, which is a long term prospect. Otherwise, it will never be possible to collect the expected amount of revenue. The businessmen of India and Bangladesh are more interested in trade through this port due to the ease of communication. However, due to lack of necessary infrastructure, traders cannot import products as per the demand. And so, the revenue is declining continuously. Sazedur Rahman, general secretary of the Benapole C&F Agent Association, said it will be difficult to collect such a large amount of revenue in the current fiscal year because of the Covid situation. However, the record clearly shows even prior to Covid the port always missed its target.

Finding a balance between achieving revenue targets and ensuring a business-friendly environment is crucial to overcome the economic challenges unfolded by the pandemic. The government's expenditure comes from revenue, but it always tries to facilitate the businesses, National Board of Revenue member of tax policy Md Alamgir Hossain said Saturday. Alamgir was addressing the "Pre-Budget Discussion for FY2021-22" organised by Dhaka Chamber of Commerce and Industry (DCCI) in association with Samakal and Channel 24. Economic Affairs Adviser to the Prime Minister Dr Mashiur Rahma said "Achieving the revenue target without hurting economic activities is a priority for the government." Also read: NBR to prioritize local industries in 2021-22 budget, says its chairman "However, our tax-GDP ratio is comparatively low due to rebates at different levels. To make it more acceptable to everyone, a global standard tax, value added tax (VAT), supplementary duty (SD) and customs duty rate need to be in place." Dr Mashiur said frequent changes in tax rate may slow down business growth and he suggested a gradual increase in it with a minimum time frame.   Brac Chairperson Dr Hossain Zilllur Rahman said, "As the second wave of Covid-19 is going on, it may wallop the economy. The next budget should also have a plan of recovery like the last one. Social protection should get major attention in it." Disbursement of loans under stimulus for the cottage, micro, small and medium enterprises (CMSMEs) should be faster, and for that, mobile financial services can be engaged as a delivery vehicle, he added. Also read: Budget 2021-22: Finance Ministry's coordination council meets to set priorities, parameters Zilllur Rahman added that to keep the growth trajectory upward, the domestic market needs to be incentivised along with the export sector. "We need a transition from cheap labour economy to skilled labour economy and a game-changing policy review needs to be framed." DCCI President Rizwan Rahman hoped that the next budget would have special attention to taxation and VAT policy, infrastructure, industry and trade as well as the financial sector.

Amid the slowdown in economic activities due to the coronavirus pandemic, noted economists suggest the government must be more imaginative and tactful to get close to meeting the ambitious target of revenue collection set for the current fiscal.