Fueling corruption: Tax structure under fire
Economist Selim Jahan has said that complicated tax structures tend to encourage corruption, while the economy is currently facing pressure due to a lack of qualitative development during the previous Awami League government’s tenure.
He made the remarks on 11 April while speaking at a pre-budget shadow parliament session organised by Debate for Democracy.
Jahan stressed that every national budget should be guided by a clear development philosophy and must reflect the real expectations of citizens.
He observed that although past administrations prioritised infrastructure expansion, insufficient attention to improving the quality of economic development has left the country in a vulnerable position.
According to him, citizens primarily seek stability and economic security, but the upcoming national budget is being formulated under unusually challenging conditions.
He further noted that global factors, including tensions in the Middle East and a growing burden of external debt, are adding to fiscal pressure.
He pointed out that nearly 25 per cent of total government expenditure is now being used for servicing external loans.
At the same time, rising subsidy demands in the energy sector, export support and social protection programmes are increasing public spending, while revenue growth remains sluggish.
This mismatch, he said, is contributing to a persistent budget deficit.
Jahan also criticised the low level of tax compliance among wealthy individuals, stating that authorities are often hesitant to impose taxes on high-income groups.
He added that this reluctance is partly due to the influence of powerful business interests within the system.
Speaking at the same event, Hasan Ahmed Chowdhury Kiron, chairman of Debate for Democracy, said the current government has inherited a fragile and weakened economy.
He alleged that many projects implemented during the previous administration were significantly inflated in cost, claiming that “up to 40 per cent of expenditures involved irregularities.”
Kiron said it is essential to stop such financial leakages in order to ensure economic stability, regardless of revenue growth.
He called for a prudent, sustainable and business-friendly budget that does not increase public hardship or trigger inflationary pressure.
He also emphasised the importance of creating a supportive environment for legitimate businesses, ensuring that they are not unfairly targeted.
While accountability for wrongdoing must be ensured, he cautioned against indiscriminate actions such as freezing bank accounts, arguing that genuine entrepreneurs should be allowed to operate freely and contribute to economic recovery.
Both speakers highlighted the need for structural reforms, improved fiscal discipline and stronger governance as key priorities for the upcoming budget, particularly at a time of global economic uncertainty and domestic financial strain.
