NBR misses revenue target by Tk 8195cr in Q1
Al Amin :
The National Board of Revenue (NBR) has missed its revenue collection target for the first quarter (July-September) of the current fiscal year (2023-24) by Tk8195 crore.
NBR officials said that the slow economic activities in the country and tax exemptions on food-related items have contributed to the failure to meet revenue earning targets.
However, the revenue board achieved 14.34 per cent year-on-year growth against the targeted growth 16.22 per cent, according to a provisional data of the NBR.
Along with some mega projects including Bangabandhu Tunnel, Matarbari Thermal Power Station, VAT collection from tobacco products sales companies has increased slightly.
On the other hand, the high rate of inflation has helped increase VAT collection, which is not expected for the overall economy, the experts said.
They further said that although the revenue growth in the first quarter increased slightly, it is not enough to achieve the target for the current fiscal year.
Even the targets given by the International Monetary Fund (IMF) under the loan program will not be possible, they added.
In this case, at least 19 per cent growth needs to be attained to achieve the target, although the average growth rate in the last five fiscal years is 10.64 percent.
So, major reforms in the revenue sector are required to achieve these targets, they said.
The NBR collected Tk 76751.30 crore in tax revenue during the period of July-September against its target of Tk 84946.93 crore, the NBR data showed.
Two wings of the NBR — VAT and Income Tax — achieved more than 17 per cent growth in revenue collection compared to the corresponding period of last year.
On the other hand, the Customs wing of the NBR achieved 7.45 per cent growth in the three months period of the current fiscal year due to import restriction on major items.
Economists said higher exchange rates in conversion from US dollar to Bangladesh Taka and the domestic inflation played a significant role in spurring the tax revenue collection in Q1.
The country’s inflation surged to a record around 9.5 per cent in past several months, the highest in 12 years, due to adverse effects of fuel price hikes, according to the Bangladesh Bureau of Statistics (BBS).
Dr Ahsan H Mansur, Executive Director of the Policy Research Institute of Bangladesh (PRI), told The New Nation, “Exchange rates of dollar helped collect 20 to 25 per cent higher taxes at import stages.”
On the other hand, domestic VAT collection went up due to inflationary pressure on people as prices of most of the products increased, he added.
An economic slowdown was due in coming months that might hit construction and other sectors eroding the purchasing power of people, he said.
He, however, said the revenue collection target for NBR was modest this year compared to the previous years’ ambitious target.
The government has set a Tk 4,30,000 crore revenue target for the NBR, expecting 16.22 per cent growth over the previous FY target which was Tk 3,70,000 crore.
