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The government should try to secure external financing to meet its budget gap for fiscal year 2020-21, said the Centre for Policy Dialogue, or CPD, on Saturday.
"It is critically important to give heightened attention to seeking and utilizing new funding opportunities available from external sources," the CPD said, stressing multilateral and bilateral fundings.
The think-tank argued Bangladesh should take the advantage of the decision of the G-20, which has announced providing cheaper loans to the low-income countries, helping the poorer nations combat the COVID-19 pandemic.
The views came at a virtual news conference moderated by its executive director Dr Fahmida Khatun.
Senior research fellow Towfiqul Islam Khan presented the paper on CPD's recommendations for the national budget for FY 2021.
Distinguished fellow Professor Dr Mustafizur Rahman, research director Dr Khondaker Golam Moazzem also joined.
The CPD is in favour of retaining the corporate tax rate and called for reducing the lowest slab of income tax by 5.0 per cent.
It also suggested raising the minimum income tax threshold to Tk 350,000 from the existing Tk 250,000.
The centre also stuck to its earlier stance on the issue of whitening undisclosed money advising no such opportunity be given in the next budget as it does not help the government increase its tax revenue earning.
Instead, the tax authority should curb tax evasion as this will help boost resource mobilisation, it added.
The turnover tax waiver applied to smaller enterprises may be enhanced up to Tk 10 million from the existing Tk 5.0 million.
Mr Khan said the profit of the Bangladesh Petroleum Corporation will rise significantly as a result of oil price crash in the international market.
"The government may utilise it for feeding the poor," he argued.
He said refinancing state firms and recapitalising government banks may be discontinued, considering the effects of Covid-19, which continue to unfold.
While presenting the keynote paper, Mr Khan said project prioritization is indispensable.
"Less-important projects of the annual development programme should be curtailed," he said, adding foreign-funded ADP projects that create employment should be given priority.
Mr Khan said there is a need for ensuring supply chain of essential commodities at fair prices, for which import duties can be lowered.
He said the budget should give such incentives to stimulate domestic demand.
Replying to questions, Dr Rahman said the health sector should be given priority having due regard to Covid-19 that has laid bare the country's rickety medicare system.
He said the government allocations for health in the budget are equivalent to just over 1.0 per cent of gross domestic product, or GDP.
He underlined the need for lifting health allocations by at least 2.0 per cent of the GDP.
The citizens spend much on their own on medical purposes, he said, adding this "out-of-pocket" expenses for health in Bangladesh are among the highest in South Asia.
He said raising the health budget alone is not enough, but its optimal use must be ensured.
He estimated the capital flight during the last one decade to be around Tk 5.0 trillion. "If we had a small portion of it, we could have used it during this critical situation".
Mr Rahman said it is true that Bangladesh has been failing to provide adequate medical facility for lack of funds.
The CPD said there is a need for incentives for the medical professionals, including private medics who are now treating coronovirus patients.
Dr Moazzem underlined the need for diversifying export incentives regime.
He said, "We can save at least Tk 59 billion from export and remittance incentives, which may be utilised for the people."
Dr Khatun said many countries have been easing lockdown on the basis of consultation with doctors and medical experts.
Bangladesh should also reach a decision on easing movement restrictions based on science, she said, referring to a Facebook survey in which 90 per cent respondents favoured continuing the lockdown.