The National Board of Revenue (NBR) on Thursday briefed the visiting mission of the International Monetary Fund (IMF) an outline of its plan to cut tax expenditure and expedite revenue mobilisation.
The mission held separate meetings with the three wings of the NBR - income tax, VAT and customs - at the NBR headquarters in the capital to review the implementation progress of conditions tagged with their US$ 4.7-billion credit support to Bangladesh.
Officials at the NBR said the mission wanted to know the status of the NBR's target to annually raise the tax-to-GDP ratio by 0.5 per cent from the existing 7.9 per cent.
Tax officials estimated that the NBR would have to collect tax revenue of Tk 4.05 trillion in the current fiscal year to achieve the target set by the IMF.
However, the government has set a Tk 4.30-trillion target for the NBR to achieve in FY 2023-24.
A senior NBR official said the mission would hold another meeting with the NBR next week to have a comprehensive idea on tax-revenue mobilisation in two phases - December 31, 2023 and June 30, 2024.
The quarterly assessment (July-September) was difficult for the mission as the revenue collection data until September is yet to be compiled by the Ibas++ system of the government through reconciliation, he added.
A brief presentation was made at the meeting on direct tax mobilisation.
The direct tax wing would have to collect Tk 245 billion in additional revenue compared to that of the previous FY to achieve the target set by the government, according to the presentation that was handed over to the mission.
"It is assumed that regular measures as taken by the tax offices may engender 13.59 per cent revenue growth which will amount to Tk 154 billion," the income tax wing said in the presentation.
For collecting the rest of the amount worth Tk 91 billion, the direct tax wing has planned some additional measures.
The measures would generate Tk 30 billion from land registration tax, followed by Tk 5.0 billion from travel tax, Tk 3.0 billion from tobacco tax, Tk 15 billion from environmental surcharge and minimum tax, Tk 2.5 billion from tax net expansion and Tk 35.5 billion from realising arrears.
A senior revenue board official said that the mission is not convinced with the NBR's success to collect the targeted amount of arrear taxes.
Through the new Income Tax Act, additional Tk 55.5 billion would come from the upward revision of source tax rates including tax on tobacco products supply, mandatory provision on submission of proof of tax returns, turnover tax on carbonated beverages etc.
The NBR also shared with the mission its compliance improvement plan and new units to manage risk factors.
It also underscored the need for technical assistance, capacity building needs to follow up tax expenditure assessment, tax policy diagnostics, and revenue administration.
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