Govt to split NBR into two divisions by December

Staff Reporter :

The government is preparing to complete the long-discussed split of the National Board of Revenue (NBR) into two separate divisions by December this year, Finance Adviser Salehuddin Ahmed confirmed yesterday.

“We will implement the revised law within this timeframe. The draft of the new rules of business has already been prepared, and some legal adjustments remain,” Ahmed told reporters.

The announcement follows the interim government’s issuance of an amended ordinance on September 2 regarding revenue policy and management, which states that the law will come into effect on a date fixed by the government.

Under the new law, the NBR will be dissolved and replaced with two divisions-the Revenue Policy Division and the Revenue Management Division-both under the finance ministry. The restructuring is part of a major reform program tied to the International Monetary Fund’s (IMF) $5.5 billion loan package approved in January 2023.

Bangladesh, which currently has one of the lowest tax-to-GDP ratios in the world (below 8.5%), has been under pressure to strengthen its revenue system to ensure fiscal sustainability.

The reform sparked unprecedented protests by tax officials in May and June, largely over concerns about top appointments. The original ordinance issued on May 12 created ambiguity on whether tax and customs cadre officials would be prioritized for senior roles.

The revised ordinance, however, clarifies that experienced revenue officials will be eligible to lead the revenue policy division, alongside professionals with backgrounds in macroeconomics, trade policy, and planning. According to Ahmed, both the internal recharge division (IRD) and the NBR will be dissolved, making way for the two new divisions.
The revenue policy division handle tax policy, research, and international agreements while revenue management division oversee field-level tax collection, enforcement of tax laws, and human resource management.
Secretaries will be appointed to head the two divisions, while the positions of existing NBR members will be redefined. An organogram for the new structure is also being prepared.
“This reform is not just about splitting an institution,” Ahmed said. “It is about modernizing revenue governance and improving efficiency in tax collection.”