Tax receipts Tk 31,508cr short of H1 target

Staff Correspondent | Published: 22:52, Jan 26,2020

 
 

A file photo shows consumers shopping for groceries at a super shop outlet in the capital. Revenue collection by the National Board of Revenue fell short by Tk 31,508 crore or 23 per cent of the target in the first half of the current fiscal year 2019-2020 due to poor performance by the three wings of the NBR and gloomy economic activities in the country.  — New Age photo

Revenue collection by the National Board of Revenue fell short by Tk 31,508 crore or 23 per cent of the target in the first half of the current fiscal year 2019-2020 due to poor performance by the three wings of the NBR and gloomy economic activities in the country.

Officials said that failure in implementation of the value-added tax online system fully that included online VAT returns submission and installation of electronic fiscal devices, tax and duty exemption at higher rates to various sectors, and decline in import of major products were the key reasons for the shortfall.

They also attributed the tax collection deficit to an ambitious revenue collection target of Tk 3,25,600 crore set by the government for the NBR for FY20.

According to the provisional data of the revenue board, tax officials managed to collect only Tk 1,05,161 crore in income tax, VAT and customs duty in July-December of FY20 against the collection target of Tk 1,36,669 crore for the period.

Revenue collection, however, grew by 7.39 per cent in the six months compared with that in the same period of the last fiscal year (FY 2018-2019) when revenue collection was Tk 97,923 crore, the data showed.

In July-December of FY20, the NBR faced the biggest deficit in customs duty collection by Tk 13,174 crore followed by Tk 10,905 crore in VAT collection and Tk 7,429 crore in income tax collection.

The NBR collected the highest amount of revenue in VAT worth Tk 41,091 crore in the period against the target of Tk 51,996 crore for the period.

Income tax and customs duty collection stood at Tk 32,647 crore and Tk 31,424 crore respectively in July-December.

The targets were Tk 40,075 crore and Tk 44,598 crore respectively for income tax and customs duty collection for the period, according to the NBR data.

Income tax collection, however, witnessed the highest growth of 13.66 per cent followed by VAT collection 7.06 per cent and customs duty 1.96 per cent in the first half of the current fiscal year compared with that of the same period of the last fiscal year.

Officials attributed the shortfall in customs duty collection to higher duty exemption enjoyed by the government and local manufacturers and decline in import of 20 major products.

The government enjoyed a huge amount of duty exemption for the implementation of mega projects such as Padma Bridge and metro rail projects while the private sector also enjoyed a significant amount of exemption in import of machinery and raw materials.

Customs duty collection saw a deficit in the period as the import under zero-duty rate also increased while the import of higher revenue generating 20 large products, including motor vehicles, high-speed diesel, crude soya bean oil and mobile sets declined sharply in the period.

NBR officials said that the VAT wing failed to implement the VAT automation system, which was adopted to gear up the indirect tax collection.

The wing could not start installing electronic fiscal devices at shops while online VAT returns submission is yet to be fully functional, they said, adding that the NBR also could not ensure the use of customised software at companies and large shops having annual turnover above Tk 5 crore for ensuring transparency in record keeping.

VAT collection from the tobacco sector declined in the year.

Revenue from the gas sector also saw a huge deficit in the period following giving exemption of 93 per cent supplementary duty on the product.

Income tax collection also faced a setback due to exemption given to various other sectors, officials said.

The government reduced the source income tax on export earnings, supply of goods and execution of contract, on implementation of mega projects and many private sectors, which caused a decline in income tax collection in the period.

Poor contributions of the telecom, real estate and transport sectors to corporate tax payment were also identified as a major factor for the overall poor performance by the NBR, they said.

More about:

Want stories like this in your inbox?

Sign up to exclusive daily email

Advertisement

 

Advertisement

images