Published in The Financial Express on Monday, 3 March 2014.
NBR seeks to realise most of Tk 250b stuck-up revenue
Revenue collection falls short of target by Tk 10b until Jan
Doulot Akter Mala
Top tax officials met on Sunday to devise strategies including intensifying drives for realising disputed revenues to meet its sustained shortfall.
Till January of this fiscal year (FY), the revenue collection under the National Board of Revenue (NBR) fell short of target by Tk 10 billion.
All the three wings, income tax, customs and Value Added Tax (VAT) of the NBR faced the deficit against their respective targets.
Tax commissioners from across the country met at the National Board of Revenue (NBR), chaired by its chief Ghulam Hussain.
The meeting also gave special focus on realising the major part of Tk 250 billion revenue that remained stuck up due to court cases, making extra efforts to net prospective household owners and businesses in both cities and growth centres and finding out areas of tax evasion etc.
Tax officials blamed economic slowdown, triggered by political unrest, as the major reason for sluggish growth of revenue collection in the first seven months of the year.
Political turmoil has left a prolonged effect on revenue collection growth with slow implementation of the Annual Development Programme (ADP) by the government.
A senior tax official quoted the NBR chief as asking the tax officials to gear up efforts to collect revenue as the political situation is now normal.
“Tax officials expressed their doubts over achieving the target of Tk 1.36 trillion for FY 2013-14,” he said.
The Ministry of Finance (MoF) in principle decided to cut the target to Tk 1.25 trillion but is yet to issue any official letter regarding this, he said.
“In spite of this, it would be a challenge to meet the revised target,” he added.
Centre for Policy Dialogue (CPD) Research Director Dr Fahmida Khatun said the target for tax revenue collection has been set following upward trend of revenue collection in the past few years.
“Last year’s (2013) economic disruption hit the revenue collection target badly. People will not be able to pay tax amid such a situation,” she said.
Project implementation and other expenditures of the government depend on domestic resource mobilisation, she said.
Around 46 per cent of the budgetary expenditure comes from foreign sources while domestic sources meet the rest, Dr Fahmida added.
Revenue shortfall in the current fiscal year will force the government to borrow from other sources. “Increased borrowing will raise the interest burden and may hinder the credit flow for private sector investment,” she said.
Chittagong Stock Exchange (CSE) chairman and former NBR chief Md Abdul Mazid suggested exploring the untapped sector for augmenting revenue collection.
Transparency among both taxmen and taxpayers is needed for proper collection of tax revenue, he added.
“Many of the big companies still avoid payment of income tax. Taxmen should look into the new potential sectors rather than imposing burden on the existing ones,” he added.
In July-January period, NBR collected an aggregate amount of Tk 594.77 billion achieving 10 per cent growth over the corresponding period.
In January, import duty collection posted a negative growth due to sluggish trend of import of revenue-generating products.
Aggregate revenue collection fell short of Tk 700 million in January against the corresponding month of last year.