Revenue shortfall may raise budget deficit to 7pc of GDP
01 March 2015, Nirapad News: The Unnayan Onneshan (UO), an independent multidisciplinary think-tank, said that the shortfall in revenue collection in the current fiscal year vis-à-vis budgetary target may be larger than those in the previous fiscal years, which will cause the budget deficit to rise to 7 per cent of GDP in FY 2014-15, due mainly to current political standoff-induced sluggish economic activities.
The organisation in its February issue of Bangladesh Economic Update urges for an inclusive political dialogue amongst the political parties to reach solutions that would boost the business activities in the economy and thus foster the collection and mobilization of revenue.
The research organisation employs two methods in estimating the shortfall in the collection of revenue in FY 2014-15. First, the shortfall in revenue collection has been estimated by taking account of the historical trend. Second, the trend in the revenue collection of the fiscal years as regards political standoff due to national parliamentary election has been taken into consideration with a view to estimating the current fiscal year’s revenue collection.