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Even revised target a challenge for NBR


Published : 15 Jun 2019 08:43 PM | Updated : 24 Aug 2020 04:27 AM

The National Board of Revenue is in the face of a gauntlet over meeting even the revised revenue collection target, set for it in the current fiscal (2018-19). The NBR initially targeted to collect Tk 296,201 crore in the ongoing fiscal, up 36.8 percent from that of the actual collection in the last fiscal.

However, the government later, following the incapability of the NBR, revised the target to Tk 280,000 crore. The NBR in the fiscal 2017-18 could collect a total of Tk 187,106 crore. The matter of concern is, the exchequer in the first ten months (July-April) of the current fiscal could collect only Tk 173,422crore, at a monthly average of Tk 17,342 crore.

As per this count, the revenue collection may reach around Tk 208,106 crore at the year-end. If it so happens, the revenue shortfall will be Tk 88,095 crore against the target, and Tk 71,894 crore against the revised target. The revenue board incurred a shortfall amounting to Tk 50,367 crore during the July-March period of the ongoing fiscal.

During this period, the NBR’s target of revenue collection was Tk 203,844 crore, but it could collect only Tk 153,477 crore. Experts opine that the NBR will not be able to meet the revised target anymore as it has already incurred a Tk 50,000 crore shortfall keeping three months left.
Mirza Azizul Islam told Bangladesh Post that it has now been a trend of setting of big revenue target first and later getting it shortened. The authority should get out of this trend.

“The NBR each year is over targeted by the government without considering its infrastructural and technical capacities,” he said adding that the government should set the revenue target aligned with the capacity of the revenue board. NBR would have to improve its capacity along with increasing the tax-net.

Besides, the government should also focus on setting realistic revenue target considering the previous year’s performance as well as the country’s economic condition, he opined. NBR officials blamed the higher revenue target set for them terming it as a ‘very big target’. Apart from this, the government in the current fiscal offered incentives and exemptions to many business sectors keeping the national election issue in mind.

Along with a big revenue target, the NBR in the current year registered a record low growth in the collection in the last 19 years, shrinking the overall performance. The average growth of revenue collection in the last five years was 13.64 percent, but the projected target in the ongoing fiscal was set at more than 35 percent, widening the shortfall.

The exchequer, however, could register a 7.23 percent year-on-year growth until March this financing year. Tax officials are, however, optimistic in obtaining 10 percent year-on-year growth performance at the end of the fiscal as they have taken some measures to uplift the collection in the last two to three months.

According to sources, the VAT wing has recently chalked out a plan of prioritizing five sectors including taxes from floor space, brick kiln, bidi and value added tax from local trade to lower the shortfall in value added tax target. A senior NBR official, on condition of anonymity, told this correspondent that all the initiatives at the year-end could just minimize the shortfall by some percentage points.

“The government, early in the year, offered VAT and duty exemptions from some big revenue earning sectors, and that is why the NBR now has to pay the price,” he said.