NBR suffers Tk 9,318cr shortfall in revenue receipt in July-Aug

Staff Correspondent | Published: 00:00, Oct 14,2019

 
 

A file photo shows goods-laden containers at Kamalapur inland container depot in Dhaka. Revenue collection by the National Board of Revenue fell Tk 9,318 crore short of its target in July-August of the current fiscal year 2019-2020 due to slowing down of economic activities in the country and external trade, changes in cigarette taxation and wide-scale tax exemption offered to different sectors. — New Age photo

Revenue collection by the National Board of Revenue fell Tk 9,318 crore short of its target in July-August of the current fiscal year 2019-2020 due to slowing down of economic activities in the country and external trade, changes in cigarette taxation and wide-scale tax exemption offered to different sectors.

The revenue board also registered a dismal growth of 3.35 per cent year-on-year in revenue collection in the first two months of the FY20.

In July-August of the FY20, tax officials managed to collect only Tk 29,620 crore or 76 per cent of the collection target of Tk 38,937 crore set for the period, according to the provisional data of the NBR.  NBR collected Tk 28,661 crore in first two months of the FY19.

Value-added tax, customs and income tax wings of the revenue board faced deficit of Tk 5,354 crore, Tk 3,858 crore and Tk 106 crore respectively in July-August of the FY20, the data showed.

Against the backdrop of the bleak revenue collection, finance minister AHM Mustafa Kamal on Sunday held meetings with all field-level income tax, customs and VAT commissioners at the NBR’s conference room to set out strategies for enhancing collection rates.

The minister instructed the NBR officials to expedite coordinated efforts to achieve the revenue collection target of Tk 3,25,600 crore set for the entire fiscal year.

The government would fall behind if the NBR was unable to achieve the target, he said.

Emphasising the need for restructuring the tax exemption facilities, he said that no other country in the world saw such wide-scale tax exemptions like Bangladesh.

It was not possible to achieve the revenue collection target with so many exemptions, he observed.

He also asked the revenue board not to offer any tax exemption to any sector going beyond the fiscal measures taken in the budget without pre-approval of prime minister Sheikh Hasina.

‘No statutory regulatory order will be issued unless NBR gets approval of the prime minister,’ he said.

He said that it was frustrating that only around 44 lakh of the four crore eligible income taxpayers in the country had taxpayers’ identification numbers.

NBR should take stern legal steps against eligible taxpayers who did not file income tax returns, he added.

According to the NBR data, the VAT wing collected Tk 9,573 crore, the customs wing Tk 11,199 crore and the income tax wing Tk 8,848 crore in July-August against the respective targets of Tk 14,927 crore, 15,057 crore and Tk 8,954 crore.

Income tax collection grew the highest by 12.56 per cent followed by customs’ 1.02 per cent growth while VAT wing witnessed a negative collection growth of 1.45 per cent, the data showed.

NBR officials also blamed the ambitious revenue target for the shortfall in the revenue earnings.

The government had set an ambitious revenue target of Tk 3,25,600 crore with 45.43 per cent growth for the current FY20 over the actual earnings of the corresponding FY19 when only Tk 2,23,892 crore was collected.

The government officially, however, set the growth target at 16.26 per cent over the revised collection target of Tk 2,80,063 crore set in the last FY19.

Revenue collection grew, on an average, by 13.16 per cent over the last five fiscal years, officials said, adding that it grew only by 2.82 per cent in July-August of the last FY19.

NBR chairman Md Mosharraf Hossain Bhuiyan said that revenue earnings had grown at a slower rate in the first two months of the current fiscal year due to lower growth in export-import, disruption in natural economic activities during the Eid holidays and excessive rain.

He also attributed the low revenue growth to the lower base of income taxpayers and unscrupulous traders’ attempts to evade VAT payment or to pay VAT at lower rates by reporting their sales either at VAT exempted ceiling of below Tk 50 lakh or turnover ceiling of below Tk 3 crore.

Revenue collection would gain momentum on completion of electronic fiscal devices installation, the VAT automation process and ongoing income tax survey undertaken to bring all eligible taxpayers under the tax net, he said.

NBR director general (research and statistics) Mobara Khanam made a presentation at the meeting on the overall revenue collection situation during the period.

NBR members Kalipada Halder (tax administration and human resource management), Jamal Hossain (VAT implementation and IT) and Chattogram Customs House commissioner Fakhrul Alam spoke on income tax, VAT and customs issues respectively. 

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