Big shortfall in revenue earnings in outgoing FY
Al Amin :
The country witnessed a big shortfall in revenue collection by the National Board of Revenue (NBR) as the public exchequer was able to earn Tk 3,25,272 crore in the outgoing fiscal year against an ambitious target of Tk 3.70 lakh crore.
Even though the revenue collection saw around 8.12 per cent growth, it was around Tk 45,000 crore short of the target set by the government, according to NBR sources.
The NBR officials, however, are viewing the realized amount as a positive sign considering the state of the economy.
They said multiple factors had contributed to the shortfall of revenue collection target which includes setting a higher target than the previous fiscal year, slow economic growth and the government’s measures to discourage imports round the year.
NBR was able to collect Tk 91,717 crore from customs and import duty registering with 2.56 per cent year-on-year growth against the target of Tk 1,11,000 crore during the time.
On the other hand, the revenue board earned Tk 1,20,633 crore with 11.27 per cent year-on-year growth from Value-Added Tax (VAT) wing against the annual target of Tk 1,36,900 crore.
Meanwhile, it collected Tk 1,12,921 crore from income tax and travel tax wing against the target of Tk 1,22,100 crore during the July-June period of the outgoing fiscal year, according to the NBR sources.
The low performance of revenue mobilization has forced the government to borrow Tk 1,26,000 crore from banks as on June 22 to meet the budget deficit.
Of the borrowing, Tk 98,000 crore has been taken from the Bangladesh Bank, according the central bank data.
Dr Ahsan H Mansur, economist and executive director at Policy Research Institute (PRI), said, “the NBR has failed to collect the amount of revenue that should have been collected according to the size of the economy.”
“A large number of taxable persons are outside the ambit of tax, which is putting more pressure on those who are paying taxes regularly,” he said.
The government has taken initiatives to discourage imports from the beginning of the fiscal year to prevent the dollar crisis in the domestic market.
As a result, imports declined by around 29 per cent during the time dragging down customs duty collection. However, the revenue board was able to attain 2.56 per cent year-on-year growth in the sector.
Dr Fahmida Khatun, Executive Director of the Centre for Policy Dialogue (CPD), said the normal record of the NBR is that tax targets remain unattained.
“We have seen it again. There is a capacity issue of the NBR. The tax net is not expanding while the implementation of the reforms has been sluggish,” she said.
“Without reform and capacity-building and institutional strengthening, no target will be achieved,” she added.
