Published in The Daily Star on Monday, 3 March 2014.
NBR stutters in tax collections
Sohel Parvez
The tax authority’s revenue collections in January slipped nearly one percent year-on-year due to falling receipts from customs.
In January, the National Board of Revenue collected Tk 9,115 crore, down from Tk 9,167 crore recorded for the month last year.
Meanwhile, this is the second consecutive month in the current fiscal year that the NBR has recorded negative growth, a side-effect of the prolonged political unrest in the lead-up to national elections in January.
“This is a reflection that demand still remains slack and confidence is yet to be restored, although there were expectations of a pick-up in economic activities after elections,” said Towfiqul Islam Khan, research fellow of Centre for Policy Dialogue.
Overall, the tax authority collected Tk 59,477 crore in July-January, up 9.96 percent year-on-year.
In the first seven months, VAT collections grew 14 percent to Tk 22,507 crore, income tax receipts 18.19 percent to Tk 18,331.98 crore, while receipts from customs fell 1.14 percent to Tk 18,284 crore.
Khan linked the sluggish revenue collection to the falling customs duties and slowing receipts from income tax, one of the major drivers of revenue collection growth in recent months.
Revenue officials blamed declining imports and appreciation of the taka against the dollar for reduced imports.
Imports slipped 0.11 percent year-on-year to $16,044 million in the first six months of fiscal 2013-14, according to central bank statistics.
“Food grains imports rose in the current fiscal year, but it has no duty. Indeed, a significant part of the import growth was attributed to duty exempted goods.”
“But growth of imports that face higher tariff is not good,” he said, predicting that the NBR might fall short of Tk 16,000-18,000 crore from its original collection target of Tk 136,090 crore for the fiscal year.
Earlier, the NBR urged the finance ministry to revise down the collection target to Tk 120,000 crore.
The tax authority, however, in a meeting with field officers yesterday asked for strengthening revenue collection efforts and advised field offices not to show strikes and blockades as an excuse.
“We must go all-out in our collections as the situation is normal now,” said Syed Md Aminul Karim, member of tax policy wing of NBR.
However, another NBR official asking not to be named said field officers must not be too forceful in their collections either.
Extra efforts must be taken to realise overdue taxes, while expediting the pending cases, he added.