Acc 303 report pdf.

“An analytical comparison of Bangladesh Government’s
Budget between Fiscal Year 2017-18 and 2016-17”.
BBA Student, IUBAT 12/3/17 TAX ( ACC 303)

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“AN ANALYTICAL COMPARISON OF BANGLADESH GOVERNMENT’S BUDGET BETWEEN FISCAL YEAR 2017-18 AND 2016-17”.
AN ANALYTICAL COMPARISON OF BANGLADESH GOVERNMENT’S
BUDGET BETWEEN FISCAL YEAR 2017-18 AND FISCAL YEAR 2016-
17”.
PREPARED FOR:
Tiasha Islam
Faculty of BBA, IUBAT
PREPARED BY:
Sl. NAME ID
1. Afsana Jaman 14102295
2. Effat Ara Chowdhury 14302054
3. Jannatul Ferdous 14202024
4. Nowshin Laila 14202061
5. Shaidul Islam Tusher 14202041
Course Name: Tax
Course Code: ACC 303
IUBAT- International University of Business Agriculture
and Technology
Date of Submission: 3 December 2017;1.00pm

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TABLE OF CONTENT
SL. INDEX PAGE
NUMBER
1. EXECUTIVE SUMMARY 3
2. 1.0. INTRODUCTION 4
3. 2.0. BRIEF DESCRIPTION OF BANGLADESH BUDGET
 2.1. INCREASE IN TAX
 2.2. VAT LAW CAUSE OF CONCERN
 2.3. GOVERNMENT DEPENDENCY ON BANK
LOANS
 2.4. INCREASE OF GAS AND ELECTRICITY PRICE
 2.5. BUSINESS ACTIVITIES
 2.6. BUDGET STATISTICS
 2.7. REVISED BUDGET 2017-18
4-11
4,5
6
7
7
7
9-10
11
4. 3.0. ANALYSIS
 3.1 INCOME TAX CHAGES
o 3.1.1. TAX RATE
o 3.1.2. TAX EXEMPTION
o 3.1.3. SURCHARGE
o 3.1.4. RETURN, TAX AUDIT AND INCOME
YEAR
o 3.1.5. TAX ADMINISTRATION REFORM
o 3.1.6. AMENDMENT REPLACE AND NEW
SECTIONS SCHEDULED
 3.2. PRICE CHANGES ON DAILY NECESSARY
GOODS
o 3.2.1. LIST OF PRODUCTS TURNED
CHEAPER AND COSTLIER IN PRICE
 3.2.1a). INCREASED PRICE
 3.2.1.b). DECREASED PRICE
 3.3. PRICE CHANGES ON OTHER NECESSARY
GOODS AND SERVICES
o 3.3.1. PRICE DECREASED
o 3.3.2. PRICE INCREASED
o 3.3.3. FAST FOOD PRICE INCREASES TO
11.5%
o 3.3.4. EXPENDITURE WORKER’S
EXPETRIATE AIRFAIR INCREASED
12-23
12-18
12
13,14
14
15
16
17
19-21
19-21
19
20
21-23
21
22
22
23
5. CONCLUSION 23
6. BIBLIOGRAPHY 24-25

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Executive Summary
Learning about Bangladesh Government’s Budget is very crucial part for studying Tax.
Because the main parts of a good taxation system in a country depend on a fruitful Budget
allocation of the government. This report has made on “An analytical comparison of
Bangladesh Government’s Budget between Fiscal Year 2017-18 and Fiscal Year
2016-17”.
The changes of the two Budgets are speculated in this dissertation having knowledge
more about Taxation. We are the BBA students of IUBAT, have made this report on
Bangladesh Budget analysis to fulfill the assigned task of the Course “ACC-303” having
sufficient knowledge of taxation to implement the practical work experience.
All the analyzation is done mostly based on Bangladesh Budget review of 2017 from
different newspapers, journals, articles, and NBR website and has been prepared
comparing previous year Budget of 2016-17. Bangladesh budget history shows that
sustainability rate of the budget implementation is very low. And very high ambitious
budget is prepared but actual plan is not scheduled to customize the revenue
collection system. Middle class and poor people are suffering a lot facing price hike
due to the lack of income and maximum expenditures on daily needs. Brief description
of Bangladesh Budget is added here to make more sensible about financial
expenditures of people’s daily life and taxations concern so that proper contribution
can be done in collecting revenue as a good citizen of this country. So, here in the
dissertation, income tax amount is showed statically and increase price as well as
decrease price chart is provided to learn consumer act of general people.
VAT imposition makes the life of general people difficult. But, if VAT collection would
be customized, economy of Bangladesh could develop more.
Bangladesh government’s Budget tells the economic growth and contribution of
government policy that indicates the GDP rate is rising up or not. Although Budget is
not implemented in accordance of expectations of the economic analysis, there is a
good growth of GDP.

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1.0. Introduction
Government Budget is an itemized accounting of the payments received by government
(taxes and other fees) and the payments made by government (purchases and transfer
payments). The financial statement of expected revenue is accumulated through
budgeting where all kinds of expenditures are scheduled in development and non-
development sectors. A budget deficit occurs when a government spends more money
than it takes in. The deficit of a budget may create the lack of revenue generation in
taxation which impacts in the economy aggregately. So, here a short analysis in changes
of income tax is schemed reviewing NBR income tax profile and Bangladesh Budget
implementation according to the Finance Act 2017.For the changes of some acts
comparing previous one price of daily necessary goods and other goods and services is
also got non-persistent.
2.0. Brief Description of Bangladesh Budget
Bangladesh Government’s Budget is scheduled in every fiscal year, starts from June of
the year according to the finance policy. The Budget is approved by President of
Bangladesh and presented by the finance minister to the nation. A brief comparative
description of Bangladesh Budget is given bellow according to the fiscal year 2017-18
and 2016-17.
2.1. Increase in Tax:
The Bangladesh government plans to increase National Board of Revenue (NBR)
collected taxes by 34.16% as per the currently put budget for financial year 2017-18 in
compared to the revised budget of 2016-17. This increased amount of money is going to
be directly imposed upon general businesses and individuals. It is understood that
generally businesses need to pay all the taxes in the categories mentioned in table 1. To
achieve the increased goal NBR will must impose more taxes in all aspects of the
businesses.
Table:1. Trend of Increase in National Board Revenue ( NBR) tax incomes ( crore in
Taka) from Individuals and Businesses ( Source Ministry of Finance )
Description Budget 2017-18 Revised Budget
2016-17
Tax on Income and Profit 85176 62754
Value Added tax ( VAT) 91254 68675
Import Duty 30023 21571
Export Duty 44 33
Excise Duty 1599 1499
Supplementary Duty 38401 29519
Other Taxes and Duties 1690 1245

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Total NBR Tax 248190 185000
To increase earnings from taxes NBR is likely to ride heavily on VAT. Though final
pressure will be on the general people those who consume the products and services, an
unequal but open market global business arena will cause extra cost pressure of
business. Cost of many input supply to the textile and clothing sector will increase.
Figure 1: Trend of increase (in crore taka) in different NBR taxes on businesses and individuals .
Potential increase of different import and other duties will cause direct rise in cost of
business particularly its impact is huge on textile and clothing industry as most of the
businesses in this sector is related to export and import.
Table2: Non- Development & Development Budget 2017-18(Taka 4,002.66 Billion
use of resources)
TAX REVENUE:
 VAT
 Import Duty
 Income Tax
 Supplementary Duty
 Others
62.0%
36.8%
12.1%
34.3%
15.5%
1.3%
Foreign Grants 1.4%
Foreign loan 11.6%
Domestic loan 15.1%
Non-tax 7.8%
0
50000
100000
150000
200000
250000
300000
Trend of Increase in National Board Revenue ( NBR) tax incomes
( crore in Taka) from Individuals and Businesses ( Source
Ministry of Finance )
Budget 2017-18 Revised Budget 2016-17

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TAX REVENUE 2.1%
Figure 2: Different sources of revenue in the budget 2017-18
Figure 2 shows that Bangladesh government is heavily dependent on the tax revenues
mainly paid by the businesses and individual. 62 percent of the budget is coming from
NBR taxes.
2.2. Vat Law Cause of Concern:
Pic 1: VAT Pressure (Source: Dhaka Tribune)
Finance Minister AMA Muhith proposed budget has become the same impact putting
the people through the VAT machine to take-out evert mint possible. Finance Minister
Abul Maal Abdul Muhith felt that the implementation of the new Value Added Tax
(VAT) law would be difficult to implement in this budget of the fiscal year 2017-
18. He also said that the budget reform will be done in advance. “In the face of
62%
1%
12%
15%
8%2%
Non- Development & Development Budget 2017-
18(Taka 4,002.66 Billion use of resources)
TAX REVENUE Foreign Grants Foreign loan
Domestic loan Non-tax TAX REVENUE (NON-NBR)

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criticism, some of the essentials have been kept vaccinated, but the highest VAT
rate in South and South-East Asia is expected to increase the overall inflationary
pressure”- (Quoted from Prothom Alo). Under the new law, the finance minister
made the budget for the current fiscal year with 15 percent VAT rate. But in view of
the demands of the traders, at the directive of Prime Minister Sheikh Hasina, this
law was delayed by two years.
2.3. Government dependency on bank loans:
As per the figure 2 government is planning to borrow Tk 28,203 crore from banks and
another Tk.32,149 crore from non-bank domestic sources, which will reduce available
fund for private sector investment. The government will need to do this to cover huge
budget deficit of Tk.112,276 crore. The deficit is more than 5% of the GDP. Government
is also planning to collect another Tk.51,924 crore from foreign sources to cover
gigantic budget deficit. All these loans will affect flow of capitals to the private sector
hence the cost of capital is likely to increase further.
2.4. Increase of gas and electricity price:
The price for fuel and power is increasing two fold at the beginning of the financial year
2017-18. Government has set the target of increasing non tax revenue and receipts by
96.6 percent. This increase is also likely to be imposed on businesses and public as
payments of bills of different services.
Besides affecting direct fuel and power bills above mentioned rise will also affect
transportation and related expenses for the businesses.
2.5. Business activities:
A big budget is supposed to mean higher economic activities generating higher
business opportunities. But the structure of the budget 2017-18 doesn’t suggest the
possibility of big boost in business activities.
Tk.153,331 crore has been kept for development activities which is 38.3 percent of total
budget 400,266 crore. It shows that 61.7 percent of the budget is spent in non-

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development activities. Even the set amount for development purpose many times
remains unspent due to lack of efficiency in implementation of projects.
However, the development budget for 2017-18 is 37.88 percent higher than the
revised budget of the fiscal year. The non-development budget is rising by
21.19 percent. This should make sure higher flow of money and more business
activities.
Table3: Non- Development & Development Budget 2017-18(Taka 4,002.66 Billion
use of resources)
INDUSRIAL ECONOMIC SERVICES 1%
MISCELLLANEOUS EXPENDIRURE 2.7%
EDUCATION AND TECHNOLOGY 16.4%
INTEREST 10.4%
TRANSPORT & COMMUNICATION 12.5%
LOCALGOVT. & RURAL DEV. 6.9%
ENERGY & POWER 5.3%
HEALTH 5.2%
AGRICULTURE 6.1%
DEFENCE 6.4%
PUBLIC ADMINISTRATION 13.6%
SOCAL SECURITY & WELFARE 6.0%
PUBLICORDER &SAFETY 5.7%
HOUSING .9%
RECREATION CULTURE & RELIGIOUS AFFAIRS .9%

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Figure 3: Sector wise budget for 2017-18.
2.6. Budget Statistics: Finance Minister Abul Maal Abdul Muhith gave a new budget
of higher income and higher expenditure without giving minimal discount to the
general income. The budget size of the fiscal year 2017-18 has been estimated at Tk
400,266 crore. In the budget of 2016-17, the original budget of 3 lakhs 40 thousand
605 crore, but the revised budget is reduced to 3 lakhs 17 thousand 174 crore. The
big budget has been given, but the implementation will not be implemented till the
end.
According to the National Board of Revenue (NBR) for the fiscal year 2017-18, the
revenue received from non-NBR, non-tax receipts and possible foreign grants, was
received in revenue amounting to Tk 2 lakh 93 thousand 494 crore. Revenue receipts
for the current fiscal year was Tk 2,472 billion. However, the revised budget is
reduced to Tk 2.8 billion. The finance minister confessed in the budget speech,
"Income tax, profit tax and VAT revenues were not expected. The target of collection
from Value Added Tax (VAT or VAT) in revenue receipts is Tk. 91,254 crores. In the
INDUSRIAL
ECONOMIC
SERVICES
1%
MISCELLLANEOUS
EXPENDIRURE
3%
EDUCATION AND
TECHNOLOGY
16%
INTEREST
10%
TRANSPORT &
COMMUNICATION
13%
LOCALGOVT. &
RURAL DEV.
7%
ENERGY & POWER
5%
HEALTH
5%
AGRICULTURE
6%
DEFENCE
6%
PUBLIC
ADMINISTRATION
14%
SOCAL SECURITY &
WELFARE
6%
PUBLICORDER
&SAFETY
6%
HOUSING
1%
RECREATION
CULTURE &
RELIGIOUS AFFAIRS
1%
NON- DEVELOPMENT & DEVELOPMENT BUDGET 2017-
18(TAKA 4,002.66 BILLION USE OF RESOURCES)

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fiscal year 2016-17, in the revised budget, Taka 68 thousand 675 crores could not be
able to recover the collection target from 72 thousand 764 crores. That is, indirectly,
the Finance Minister's most trusted place is to do.
For the current fiscal year, the non-implementation expenditure has been estimated
to be Tk. 2 lakh 34 thousand 13 crore. In the budget of the fiscal year 2016-17, the
expenditure of Taka 2, 15 crores 744 crore was reduced to the revised budget of Taka
1.729 billion. And the plan to spend the development cost 1 lakh 59 thousand 13
crore. In the budget of the current fiscal year, the cost is 1 lakh 17 thousand 27 crore,
but in the revised budget is 1 lakh 15 thousand 990 crore. Budget deficit (excluding
grants) for the fiscal year 2017-18 has been counted for 1 lakh 12 thousand and 276
million. In the fiscal year 2016-17 it was Tk 97,853 crore, which was later made 98
thousand 674 crore taka.
In the current fiscal year, the goal of getting loan from abroad is 46 thousand 420
million. In the fiscal year 2016-17, the target was Tk 30 thousand 789 crore, but in
the revised budget, 24 thousand 77 crore taka was collected in the budget. That
means, this year's revised budget is almost double the target of foreign
borrowing. There has never been so much of foreign debt in Bangladesh's history. In
addition, to meet the budget deficit, the target of internal loan has been set to 60
thousand 352 crore taka. Though the fiscal year 2016-17 was 61.454 million, the
government could not remain within this limit. In the revised budget of the fiscal year
2016-17, the target of internal loan was made to 69 thousand 903 crores.
In addition to banking loans, savings accounts are the main source of internal debt. n
the fiscal year 2016-17, the government has sold Tk. 45 thousand crore savings
certificate for the sale of savings certificates of Tk. 19,610 crore. Ahead of the target
of 30 thousand 150 million. The Finance Minister himself said in the budget statement
that the amount of money can be substantially increased through savings certificate
in the current fiscal year 2017-18.
The finance minister himself said at the end of the budget speech that the good
governance needed to go ahead with the development highway. He gave a lot of

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speeches about establishing good governance. Says the establishment of good
governance through administrative reforms. It says about the increase in productivity
and the development of the individual sector. But there is no direction of how the work
will be done in this budget. The continuous journey to the highway of prosperity will
continue and will continue till the final goal is reached. The big question is; how far
can the new budget take to the end. (Source: Prothom Alo, Economy News, 2 June,
2017)
2.7. Revised Budget 2017-18
The revised budget will be 3 lakhs 71 thousand crore Taka: Finance Minister Abul
Maal Abdul Muhith has said that the revised budget of the current fiscal year will
amount to 3 lakh 71 thousand crore Takas. A meeting of the revenue exchange
coordination committee and the resource committee was held in the Secretariat on
Sunday,26 November,2017. After the meeting, the Finance Minister said this to the
reporters. The Finance Minister said that the size of the budget for the fiscal year
2018-19 will be 4 lakh 68 thousand crore takas. The budget size of this year is Tk
400,266 crore, it will be amended to Tk 3 lakh 71 thousand crore. It will be finalized
in February. The Finance Minister said that the implementation rate of the budget for
the first four months of current fiscal year is better than the same period last year.
Muhith said, when asked about the situation of revenue collection, it is also better
than the previous fiscal year. (Source: Prothom Alo Economy, 26 November, 2017
19:09)

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3.0. Analysis
After analyzing the Bangladesh Government’s Budget 2017-18 and 2016-17, three
distinct comparisons of two fiscal years’ budget have been observed which are
scheduled in this dissertation. Comparisons of the following sections are:
1) Income Tax
2) Price Changes on daily necessary Goods
3) Price Changes on other goods and services
3.1. Income Tax Changes: Changes in income tax after passing Finance Budget Act
2017:
Total expenditure has been estimated at BDT 400,266 crore for 2017-18 and the estimate
of NBR revenue collection is BDT 248,190 crore.
NBR would collect the above huge volume of revenue from following four sources:
a) Income and corporate tax
b) Import and export duty
c) Value Added Tax (VAT)
d) Supplementary duty
In 2016, the emerging and developing economies of the world spent around 30.8% of
GDP on an average as government expenditure whereas ours were barely 13.5%.
From the July 01, 2017 the changes have been implemented in finance or accounts
related transactions.
To see the changes at a glance following major areas could be observed:
1. Tax rate
2. Tax exemption
3. Surcharge
4. Tax administration reforms
5. Replace of section/schedule

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6. New section/schedule inserted
7. Including specific rate in separate annexure
3.1.1. Tax Rate
Slab wise tax rate for individual taxpayers and corporate tax rate remain unchanged in
2017-18.
In the budget of 2017-18, RMG is the most benefited sector in terms of tax rate.
The major changes in the tax rates for individual and corporate taxpayers are:
 Individual taxpayers slab wise tax rate remain unchanged (annexure 1).
 Minimum tax remains unchanged for individual taxpayers who have a total income
exceeding tax exemption threshold:
1. Dhaka North, Dhaka South and Chittagong City Corporation Taxpayers BDT 5,000
2. Other City Corporation Taxpayers BDT 4,000
3. Other places Taxpayers BDT 3,000
 Corporate tax rate remains unchanged (the annexure 2).
 Withholding tax rate on readymade garments export has increased to 1% from
0.70%.
 Corporate tax rate on readymade garments reduced to 12% from 20%. Moreover,
reduced tax rate @ 10% if the factory of such company has an internationally
recognized green building certificate.
3.1.2. Tax Exemption
There was a huge debate about tax exemption threshold in printing, electronic and social
media over the month of June after budget proposed by the finance minister in the
parliament.
Expert in this sector said that inflation and per capita income are increasing each year.
So the exemption threshold should be near BDT 300,000 in general cases.

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But government supplemented another issue by remembering that in most developing
countries, the tax exemption threshold ratio is about 100% of per capita GDP whereas in
Bangladesh the ratio is more than 200%.
Therefore, in the threshold as before except following some exceptions.
 Tax exemption threshold for person with disability is BDT 400,000 in place of BDT
375,000.
 Tax exemption threshold remain unchanged in general cases.
 Tax exemption threshold for the parents or legal guardians of a person with
disability is BDT 25,000 higher. (details tax exemption threshold for individual
taxpayers the annexure 3)
 Conditional tax exemption for infrastructure sector such as tolled national
highways, expressways, flyovers, elevated and at-grade expressways, subway
constructed under PPP.
Tax exemption extended for another 8 new information technology sector:
i. Software or application customization
ii. Website development
iii. Website hosting
iv. Digital data analytics
v. Software test lab services
vi. Overseas medical transcription
vii. Robotics process outsourcing
viii. Cyber security services
Any investment from an alternative investment fund recognized by BSEC. But if
the income from this fund is distributed then the income should be recognized as
dividend and will be taxable.
Any income of the BSEC for the Assessment Years starting from the first day of
July, 2017 to the thirtieth day of June, 2022.

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Any amount in the nature of an honorarium or all allowance from Bangladesh
Freedom Fighter Welfare Trust or any welfare allowance received by any person
from the Government.
Any reward received by any person from the Government.
Limit the cost of bus or minibus to BDT 2,500,000 for allowing depreciation is to be
waived of transportation service for students of an educational institute or the
employees of a business entity.
Any income derived from the operation of an elderly care home.
3.1.3. Surcharge
Surcharge is introduced by the government to combat the risk of increasing inequalities
resulting from the continuous economic growth of country.
Finance minister confirms that surcharge will be maintained until the net wealth tax is
enacted.
Besides the risk of inequalities, surcharge also implemented for the hazardous products
which are harmful for health like tobacco products.
 Net wealth surcharge rate for individual taxpayers remain unchanged (the
annexure 4).
 5% surcharge on the income from the business of producing cigarette, bidi, zarda,
gul and other tobacco items.
The minimum surcharge is BDT 3,000 if the net wealth exceeds BDT 22,500,000.
3.1.4. Return, Tax Audit and Income Year
 Allowing a branch office, liaison office or a subsidiary office (including a subsidiary
thereof) of a foreign parent company to maintain an income year uniform to its
parent company.
 The return submission date for the companies which was on 15 July extended to
15 September.

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 Introducing online submission of returns, appeal petitions, alternative disputes
resolution (ADR) petitions and other applications
 Make optional to submit wealth statement for individual taxpayers whose wealth
will be exceeded BDT 25 lakh. But if any taxpayers have motor car or have
apartment or investment in buying house then he should submit the statement.
 Make more easily, transparent and friendly tax audit.
 Make mandatory to submit return for an employee holding an executive or a
management position in a business or profession.
3.1.5. Tax Administration Reform
Regularly reports on tax disputes are publishing in our media.
These tax disputes can be resolved by the businessmen with the help of taxmen if tax
administrative reforms are implemented with the changes of business environment.
Finance minister said that modernization and automation of tax system will be
implemented gradually to introduce global best practice in tax law and administration.
Therefore a number of reforms for the simplification of tax system and better NBR
clarification have been proposed in the budget.
We all know that to collect the huge revenue through NBR, tax administration reform is
essential.
And following reforms will be initiated during the current financial year.
 Introduction of e-TDS system under a central withholding tax unit with required
number of withholding tax zones under the central unit.
 Establishment of a modern and fully automated tax information unit that will be
connected to other systems and database of the country, automatically gather tax
related information from that interconnectivity for the purpose of expanding tax net
and combating tax evasion.
 Establishment of an appropriate administration setup for the international taxes that
will deal with combating cross-border tax evasion, capital flight and facilitating
recovery of such evade tax.

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 System generated order, notice, requisition, certificate, communication, letter or an
acknowledgement of receipt generated by computer or electronic system
 Accounts of taxpayers, statements, documents, data etc. submission on electronic
form or electronic media.
 Expending the area of tax registration.
 Rationalizing some tax deducting provisions and removing some application
ambiguities.
 Expansion of scope of reopening of tax evasion cases and ensuring simplification,
transparency and removal of ambiguities regarding disposal of such cases.
 Establish two new tax zones in Jessore and Kustia and gradually expand in all
important districts.
 Establish tax circle offices in 103 new upazillas in addition to existing 87 Upazillas tax
circle offices.
3.1.6. Amendment, replace and new section/schedule
In each financial year, there was comparatively more changes in amendment of
section/schedule than replace or inserted of new section/schedule in income tax.
Most of the amended of section/schedule are mentioned in the above major areas in
this report. For further clarification the finance act 2017 can be downloaded from
referenced website.
Annexure 1: Individual taxpayers tax rates other than companies:
Income slab Tax Rate
On first BDT 250,000 0%
On next BDT 400,000 10%
On next BDT 500,000 15%
On next BDT 600,000 20%
On next BDT 3,000,000 25%
On the balance of total income 30%

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Income of non-resident 30%
Annexure 2: Company Tax Rate
Description Tax Rate
Publicly Traded Company 25%
Non- Publicly Traded Company 35%
Publicly traded Bank, Insurance and Financial Institute (other than
Merchant Bank)
Newly established Bank, Insurance and Financial Institutions
approved by government in 2013
40%
Non-publicly traded Bank, Insurance and Financial Institution 42.5%
Merchant Bank 37.5%
Publicly traded mobile phone company 40%
Non- Publicly traded mobile phone company 45%
Special Tax Rate
Cigarette, bidi, zarda, chewing tobacco, gul or any other tobacco
products manufacturers
45%
Income of Co-operative Society 15%
Annexure 3: Tax exemption threshold for individual taxpayers
Status Amount (BDT)
General Taxpayers 250,000
Women and senior citizen aged 65 years and above 300,000
Person with disability 400,000
Gazette war-wounded freedom fighters 425,000
Annexure 4: Surcharge based on disclosed net wealth of individual taxpayer
Amount of net wealth Rate on income tax
Up to BDT 22,500,000 0%

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From BDT 22,500,001 to BDT 50,000,000 10%
From BDT 50,000,001 to BDT 100,000,000 15%
From BDT 100,000,001 to BDT 150,000,000 20%
From BDT 150,000,001 to BDT 200,000,000 25%
Where net wealth exceeds BDT 200,000,000 30%
3.2 Price Changes on Daily Necessary Goods: When price changes for the budget of
a country, it affects the GDP and ports of the country. For personal consumption
expenditure goods category includes two sub-categories:
 Durable Goods
 And Non-Durable Goods
For durable and nondurable both goods some changes are occurred in current fiscal
year comparing with budget 2016-17.
3.2.1. List of Products turned cheaper and costlier in price:
3.2.1.a). Price Decreased
1. Local Refrigerator: The VAT exemption period has been extended up to 2019
in the local production stage of refrigerators and freezers and for the import of
materials and spare parts used to manufacture these two products. As a result,
their prices will remain low.
2. LP Gas Cylinder: "Proposals for import of machinery, parts and materials for
the installation of LP gas project and deduction of existing import duty on raw
material for LPG cylinder from 10% to 5%.
3. Computer Laptop: At the local level, computers, laptops, tabs, cellular phones
and iPad prices have fall.
4. Tissue-toilet paper: Reduction of supplementary tariff by importing foreign
toilet paper, tissue paper, towel or napkin paper can reduce prices by 5%.

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5. Ceramic products: Due to the import of ceramic products with bath tub, sink,
wash basin and urinal, the cost of supplementary duty reduces by 10 percent.
6. Agricultural machinery: Due to the customs duty on some equipment used
for making agricultural machinery and equipment, prices of these instruments,
including nuts-bolts and gear, might decrease.
7. Hair care products: Reduction in tariff duty on import of hair care products
can reduce by 10 percent.
Figure4: Decrease Rate of Goods
3.2.1.b). Price increases
1. Electric parts: Due to the increase in the tariff rate of import of different parts
of electric product from the existing 10 to 25 percent, the price of such
commodities will increase.
2. Soap-detergent: Proposal to increase supplementary tariff from 20 to 25
percent to import Surface active, soap and soap as used for common products
and detergents.
3. Tap-Bathroom Fittings: Propose to increase the supplementary duty from 20
percent to 25 percent for importing stainless steel water tap and bathroom
fittings, basin.
4. Mosquito coil: Prices of products will increase due to the proposal to take
supplementary duty 20 percent to 25 percent for import of mosquito coils,
aerosols and mosquito repellants.
5. Rod: Instead of Tk 450 per tonne, 15 percent VAT has been imposed on rod. if
the price of one ton is 50 thousand takas, then VAT will stand at Tk 7500.
17%
17%
33%
33%
Decrease Rate
LP Gas Cylinder Tissue-toilet paper Ceramic products Hair care products

Page | 21
6. Poultry feed: Due to the increase in the duty rate from importing poultry feed
from 5 percent to 10 percent, the production cost of poultry will be increased.
7. Plastic products: Bathtub Shower Bath made of plastic, increasing the
supplementary duty from 20% to 25% by increasing the cost of importing the
sink.
8. Solar panels: Prices may increase due to the proposal to impose a 10% duty
on solar panel import.
Figure 5: products of increasing prices
3.3. Price Changes on other Goods and Services:
3.3.1. Price Decreased:
More products and services can cost less: In order to import spice products,
peppercorns, cardamom, cardamom etc., it has been proposed to reduce the tariff
rate from 25 percent to 5 percent.
3.3.2. Price Increased:
More products and services can increase prices: Due to imposition of duty and
supplementary duty on imports or increase or customs duty, prices of other products
might increase: foreign toothbrush, pad, napkin, sauce and similar products and
mustard powder, bamboo, cocoa powder, good cakes, sunflower seeds, Palm drama
or kernel, natural stone, modem, network switch, hub and router, database software,
computer software, flash memory card, print, circuit, nickel bars and rods, aluminum
tubes, pipes and fittings, magnesium tubes and pipes, vacuum cleaner, insulators,
copper pipe fittings, screw-nut-bolt, food, etc.
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
2.70%
16.40%
10.40%
12.50%
6.90%
5.30%
price Increased
1%

Page | 22
3.3.3. Fast Food Price Increases to 11.5%( as 10% supplementary duty proposed
on fast food):
FINANCE MINISTER AMA MUHITH PROPOSED ADDITIONAL TAXES ON FAST FOOD,
CONSIDERING THE HEALTH RISKS OF FUTURE GENERATIONS.
In his budget speech for the upcoming fiscal year, Finance Minister AMA Muhith on
Thursday proposed additional taxes on fast food, considering the health risks of future
generations.
The minister proposed that a 10% supplementary duty (SD) be imposed at the supply
stage on junk food items, on which 15% VAT is already applicable.
The imposition of the SD will come into effect from FY 2017-18.
Soft drinks, energy drinks, pizza, pasta, burgers, sandwiches, fried chicken, French fries
and hot dogs are among the food items. (Dhaka Tribune, June 1,2017;4:40 pm)
So, on holiday, people will be able to eat fast food with their family or friends. It
should be remembered, fast pockets can go fast and go fast. Supplementary duty
has been set at 10 percent on almost all types of fast food including pasta, burgers,
sandwiches, chicken fries, french fries, hot dogs, pizza. During the announcement
of the budget, supplementary duty was imposed in the fast food under the new VAT
Act. Although the implementation of the law was delayed for two years,
supplementary duty on fast food was kept in force.
Pic 2: Supplementary Duty on Fast Food (Source: Dhaka tribune)

Page | 23
Suppose a burger price is 100 takas. Now supplementary duty will be 10 percent. The
price of burgers with supplementary duty will be 110 takas. Up to 15 percent of the
value added tax (VAT) will be priced at Tk. 126 and 50 paisa. Earlier only VAT would
be taken; Now the cost will increase to more than Tk. 11. That means, after eating
fast food, the cost of 11 percent will increase. If there is a service charge, then there
is more cost.
3.3.4. Expenditure on expatriate workers' airfare increased:
After the criticism of the excise duty increase, the bank was reduced. But the excise
duty on air tickets or air tickets has not been reduced. From now on, there will be two
thousand takas instead of one thousand takas for air tickets outside SAARC
countries. And in Europe and America, the excise duty has been increased from one
and a half thousand to three thousand taka. Bangladeshi workers generally go to
Malaysia, Singapore and other Middle East countries. They will have to spend 1
thousand takas more when buying their air tickets. However, in the domestic and
SAARC countries, there will be an additional tax of 500 takas as before.
4.0. Conclusion
The above discussion of the dissertation, it can be concluded that Bangladesh
budget is not industry friendly. Due to big budget target, it cannot fill its target every
year. It becomes to collect target revenue. VAT law enforcements are not
implemented exactly. A big budget is supposed to mean higher economic activities
generating higher business opportunities. But the structure of the budget 2017-18
doesn’t suggest the possibility of big boost in business activities. Government’s
dependency on Bank loan, Inflations are increasing day by day for not implementing the
budget. Price of daily necessaries are increasing terribly. So, the people under poverty
cannot survive well. So, proper tax reform may make the budget implementation as well
as helping the economic growth of the country.

Page | 24
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3&Itemid=1

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