The newly elected government is set to end the current fiscal year with a large shortfall in tax collection, as revenue trends up to January have shown no significant improvement.
Until January, the National Board of Revenue (NBR) mobilised Tk 2.23 trillion, falling Tk 601.14 billion short of the target set for the first seven months of the fiscal year, according to provisional NBR data.
To achieve the revised target -- raised by Tk 540 billion by the interim government -- the NBR will need to post nearly 36 per cent higher revenue collection during the remaining months. However, revenue growth stood at around 13 per cent until January 2026.
Dr Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), said the shortfall is inevitable, as no significant reform or economic progress has been made to trigger a quantum jump in tax collection.
"In the remaining four months, the new government may not be able to bring about radical economic improvements to mobilise substantially higher revenue," she said.
Businesses are likely to continue operating at the current pace, with little scope for a sudden rise in income generation, she added.
Based on the current collection trend, The Financial Express estimates that the revenue shortfall could reach nearly Tk 1.0 trillion by June 30, 2026, unless there is a marked acceleration in collection.
However, NBR officials said revenue mobilisation has started to show an upward trend, driven mainly by higher VAT collection amid increased consumption in recent months.
The national election buzz and Ramadan have led to higher imports and increased consumption of goods, they said.
A significant portion of revenue comes from the tobacco sector, where collection has shown an impressive trend in recent months, according to a senior VAT official.
Despite collecting more than the historical average, overall revenue remains well below the ambitious target.
A senior revenue board official said the projected 35.73 per cent growth target is unlikely to be achieved, citing sluggish development expenditure, weak private investment and slow employment growth.
The NBR's target was revised upward to Tk 5.03 trillion at midyear from Tk 4.99 trillion.
To meet this target, the tax authority will need to collect around Tk 560 billion per month from February to June 2026. In contrast, the average monthly collection until January stood at Tk 318 billion, FE estimates.
During the July-January period, VAT collection grew by 16.45 per cent, income tax by 13.29 per cent, and customs duty by 7.96 per cent.
A senior tax official, preferring anonymity, said the next four months could see improved revenue mobilisation following the installation of a stable political government.
Both local and foreign investors, who had adopted a wait-and-see approach during the 18 months of the interim government, may now begin investing across various sectors, he added.
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