The National Board of Revenue (NBR) is struggling hard to bring momentum in tax collection by restructuring the state body and mending all cracks of tax evasion.
Although the state coffer witnessed an 11 per cent negative growth in tax collection in the first two months (July-August) period of the current fiscal year (2024-25), the NBR officials hope that the revenue generation will rebound soon.
According to NBR data, the revenue board managed to collect Tk 42,106 crore, registering a shortfall of Tk 15,069 crore, in the July-August period of the current fiscal year amid the slowed economic activities in the country.
The state body had collected Tk 47,562.27 crore in the same period last fiscal year.
NBR officials blamed the ongoing slowed economic activities in the country triggered by the recent political turmoil and moved away from the previous trend of posting inflated data for the negative growth in tax collection.
They added that the tax administration is currently passing through a restructuring process, emphasising providing better services for the countrymen and mending cracks of tax evasion.
After ending the tasks, revenue mobilisation will rebound sharply, the officials hoped.
Syed Aminul Karim, former member (Tax Policy) of the NBR, told The Business Post, “It was expected that the revenue collection would decline in the July-August period due to the unrest, as all economic activities were apparently suspended during the time.”
“Besides, the tax administration has concentrated heavily on restructuring the state body to cope with the changing situation. After completion of the task, revenue collection will jump up,” he added.
The current administration of NBR is firm on mending all cracks of tax evasion, and if it manages to do this successfully, revenue collection will go up automatically, he pointed out.
The tax administration has set a target of collecting Tk 480,000 crore in revenue for the current fiscal year. Finance Adviser Salehuddin Ahmed had recently said the interim government would not cut the revenue collection target this fiscal year.
The year-on-year drop in revenue generation emanated from all three sources – income tax, value-added tax and customs duties.
Collection of customs duties from international trade fell 9.8 per cent to Tk 14,485 crore owing to a fall in imports during the political turmoil.
Income tax receipts also declined by 12 per cent to Tk 18,634 crore during the time, while the collection of value-added tax, the biggest source of revenue, fell 12 per cent to Tk 16,028 crore.
Ashikur Rahman, principal economist of the Policy Research Institute (PRI), said, “The slowdown in revenue growth is mainly because of the political unrest.”
The massive political unrest that ousted the Awami League government on August 5 significantly hampered the nation's economic activities, including trade through ports.
However, Rahman thinks the NBR has been sincerely coming up with accurate data ever since the interim government came into office.
