Revenue collection rises by over 19% in August

National Board of Revenue (NBR) in August collected Tk22, 472.40 crore, a 19.12 per cent growth compared to the same period of the previous year.

The revenue collection also saw a tremendous growth of 26 per cent in August when the board collected Tk17, 798.16 crore.

However, revenue income fell short of Tk531.60 crore in August by attaining 97.69 per cent of its target of Tk23, 004 crore, according to a provisional data.

After the end of the first two months of the incumbent financial year, the revenue collection lagged behind Tk3, 319.44 crore as the board collected Tk40, 270.56 crore while the target was Tk43, 590 crore.

In the previous month, the board collected Tk8, 733.74 crore out of the total revenue in Value Added Tax (VAT) at local stage, the highest in the month followed by Tk8, 096.92 crore at import and export stage and Tk5, 641.74 in income and travel tax while the targets were Tk8, 214 crore, Tk 8,468 crore and Tk6, 322 crore respectively.

According to the data, in August the export and import collection grew by 21.81 percent, VAT at local stage saw 20.17 percent growth while the income and travel tax grew by around 14 percent compared to the same period of the previous fiscal year.

The provisional data also showed that the overall revenue collection grew by 24.53 percent in August, 2021 compared to August, 2020 with 33.14 percent growth at export and import stage, 26.81 percent at VAT stage and 12.57 percent at income tax stage.

Analyzing the provisional data, it was seen that revenue from VAT only touched and crossed the optimum target with 106.33 percent of the target while the direct tax revenue still fell behind with only 89.24 percent of the target.

As of the previous month’s data, the revenue collection was different. NBR gained only 76, 69 percent of the target in July seeming that the VAT collection fell due to the less consumption caused by the price hike.

Industrial production stability after Covid-19 pandemic and a sort of different mobilization introduced by revenue administration including automation tax deducted at source helps to grow revenue collection, said NBR officials.

At the same time, ensuring accountability in VAT collection along with policy supports to make VAT affordable increased VAT collection and enhanced tax net including mandatory tax submission to get some services enriched the revenue basket, they said.

Commenting on the revenue growth, Centre for Policy Dialogue Research Director Khandaker Golam Moazzem said, “The revenue grew due to inflated price of every essential. It is inflation-induced revenue growth at import stage and VAT at local stage.”

But it is not a sustainable way to increase revenue, he said, adding that while the prices of oil, rice and other commodities will come down the revenue collection both at import and VAT level will plummet, he said.

Creating new source of revenue collection and upgradation of the administration can boost the revenue in a sustainable way, he added.

The NBR is yet to go for full automation which is required to make the tax collection easier.

At the same time, the NBR has to pay attention to small and medium enterprises to create new sources instead of focusing only on large taxpayers and to increase the EFD activities to ensure accountability in VAT collection, he observed.