Bangladesh trails far behind regional countries in non-tax revenue netting as the NTR-GDP ratio has stagnated within a peanut 1.0 per cent during the last eight years while the government struggles for deficit financing.
This happens to be government's second-largest income source, but remains out of focus from the revenue collectors, sources said.
In the financial year 2016-17, the NTR ratio with the country's gross domestic product (GDP) was 1.0 per cent that only rose to 1.10 in FY 2019-20 and again dived to hit 0.91 per cent in FY 2018-19.
Last year, this ratio was 1.0 per cent while the tax-GDP ratio was 8.54 per cent, according to Ministry of Finance (MoF) data.
In FY2024, NTR collection marked a marginal increase to Tk 392.55 billion, equivalent to one month's tax-revenue collection by the National Board of Revenue.
Actual receipts of NRT amounted to Tk 389.56 billion in FY2023.
Non-tax revenue is one of the major sources of financing fiscal deficit in India while it contributes 40 per cent of the internal revenue in China, 27 per cent in Malaysia and 28 per cent in Bhutan.
Economists say the NTR remained mostly ignored segment for budget financing despite having enormous potential to pay off with right care.
They have urged the interim government to look into the sectors and make a move to automate service-payment portals as much as possible to mend the lapses in the collection system.
In June 2024, the MoF estimated Tk 280.47 billion losses in its 49 SoEs in the current fiscal year, double the figure in the last FY at Tk 149.62 billion.
Dr Abdur Razzaque, Chairman of RAPID, says fragile financial state of the state-owned enterprises owing to poor governance is the reason for poor growth in tax revenue.
"Unless the country could make the SoEs financially viable, its NTR won't increase to the expected level," he adds.
The economist, however, thinks increasing fees for trade-licence renewal or other charges is not the right way to increase NTR as it would add costs to business.
Also, collecting NTR from tolls is another source that should be kept for maintenance of vital infrastructures, he says.
Non-tax incomes are the money earned from dividend, interest on deposits, service fees and charges of state entities.
Dividend and profits of SoEs accounted for Tk 124.39 billion last FY, the highest among the ten sources of NTR.
From SoEs' interest earning, the government has collected Tk 21.45 billion worth of NTR followed by Tk 25.79 from administrative fees and charges, Tk 15.13 billion from fines and penalties, and Tk 9.82 billion from tolls and levies.
Departments of at least 30 ministries are the source of non-tax incomes from various services.
Increasing NTR often causes concerns of the businesses about hike in their operational costs.
Insiders in business circles have said they are ready to pay charges and fees but not willing to count "speed money" for obtaining licences and other permissions along with regular fees.
In the current FY25, the MoF projected a fivefold increase in losses in its five SoEs: Bangladesh Power Development Board, the Trading Corporation of Bangladesh, Palli Bidyut Samity, Bangladesh Petroleum Corporation and Bangladesh Chemical Industries Corporation.
Abdur Rahman Khan, chairman of the National Board of Revenue and also Secretary of the Internal Resources Division (IRD), said there was room to increase no-tax revenue from SoEs through proper monitoring.
"Also, many of the government fees remained unchanged for decades while costs of providing such services surged several times", he added.
The non-tax-revenue collection could be increased many times in the existing systems too, he observed.
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