Centre for Policy Dialogue (CPD) has recommended maintaining a conservative macroeconomic stance of the national budget for fiscal year 2018-19 (FY19), saying that the upcoming budget should avoid all conspicuous public spending, reports BSS.
"It may be tempting for a political government to consider development projects in the run up to the election by pursuing a populist approach. The budget for FY19 should avoid all conspicuous public spending for the sake of prudent macroeconomic management," said the civil society think tank in its budget recommendations.
"Please try to be more rational in the election year . . . maintain macroeconomic stability and remain caution about credit flow, interest rate, exchange rate and public expenditures," said CPD Distinguished Fellow Debapriya Bhattacharya while placing the recommendations at a programme in the capital on Tuesday.
He also suggested the government to maintain monetary policy and refrain from doing anything that can push up inflation.
Bhattacharya recommended increasing allocation for social safety net programme, health and education sector in the upcoming budget.
About the tendency of capital flight ahead of election, he urged the government and the National Board of Revenue (NBR) to keep a close watch to avert such attempts.
Money is trafficked illegally through banks, capital market and imports, he said and urged the government and Bangladesh Bank to remain alert in this regard.
"Credit growth increased in the private sector, but investment did not increase over the last three years. So, where did all the money go?" he questioned.
CPD also recommended raising the tax-free ceiling on individual income to Tk 3 lakh in the upcoming budget.
It said that the government should consider reducing the personal income tax rate for the first slab to 7.5 percent from the prevailing rate of 10 percent.