Slow growth in revenue receipts continues

Al Amin :
Revenue collection growth slowed down drastically in the first eight months (July-February) period of the current fiscal year (2022-23) due to falling customs tariff and direct taxes amid declining imports and reduced profits of firms.
The decline in tax collection is reflecting erosion of incomes of the corporate firms and the individuals as well as limiting the government’s scope to spend on development activities, experts said.
The National Board of Revenue (NBR) collected Tk 1,96,037.51 crore registering an 8.92 per cent year-on-year growth the during the July-February period, according to a provisional data of it.
The revenue board fetched Tk 1,79,984 crore registering a 16.40 per cent growth in the same period of last fiscal year (2021-22) and the last five years’ average growths were 12.12 per cent.
 The data also showed that the revenue board collected Tk 23,727.19 crore posting only 1.71 per cent year-on-year growth against the monthly target of Tk 29,440.49 crore in last month (February).
Dr Ahsan H Mansur, Executive Director of Policy Research Institute (PRI), told The New Nation, “Restriction on import activities, decline in domestic consumption, corruption and inefficiency are the main reasons for reduce in tax collection”.
The alarming revenue collection growth will hamper the country’s development activities severely as well as will make difficult to meet the loan conditions of the International Monetary Fund (IMF).  
“Face-to-face meeting and physical visit in the tax department offices have to be stopped. Services should be delivered using numbers, so that taxmen do not know the persons concerned,” he added.
According to the NBR’s data, the revenue board earned Tk 59,198.07 crore from customs, Tk 76,401.46 crore from VAT and Tk 60,437.98 crore from income tax and travel tax during the eight months period of the current fiscal year.
The deficit between collection and eight-month target was Tk 22,978.48 crore, the data said.
The revenue collection from customs or import and export duty increased by 4.36 per cent to Tk 56,726 crore in the eight-month period from Tk 59,198.07 crore in last fiscal year (FY22). On the other hand, the revenue collection from income tax and travel tax witnessed a growth of 6.29 per cent while the revenue collection from VAT experienced a healthy growth of 15.07 per cent during the mentioned period.
The NBR has a target of collecting Tk 3.70 lakh crore in the current fiscal year.
Towfiqul Islam Khan, Senior Research Fellow of the Centre for Policy Dialogue, said, “Slow progress in improving institutional efficacy for mobilising domestic resources regrettably did not get the due attention”.
Bangladesh has received loans from the IMF and it has a specific target on tax revenue.
“But the slow pace in tax collection will not meet it. The current adjustments opted by the government as a response to the macroeconomic crisis will also make it difficult to mobilise revenue,” he said.
“The NBR will need to improve its administrative efficacy to curb tax evasion and restrict illicit financial flows. The reforms in this area over the last decades never received the needed attention,” he added.