The National Board of Revenue (NBR) has detected two-thirds of e-return filers having claimed zero taxable income in fiscal year ’24, suspecting concealment of actual income by many.
Out of 1.5 million online tax returns, the filers of some 1.0 million have claimed they have no taxable income, said NBR Chairman Md Abdur Rahman Khan on Monday at a pre-budget meeting with Economic Reporters' Forum (ERF) held at the revenue board's office.
He said the situation is almost the same for manually-submitted tax returns.
At the meeting, ERF President Doulot Akter Mala placed budget proposals for FY26.
The proposals include raising the tax-free income limit to Tk 0.5 million; ensuring tax refunds; introducing online returns for all; limiting the tax rate to below 5.0 per cent for essential commodities, education, and health equipment; keeping private provident funds tax-exempted like government ones; increasing tax rates for well-off people; introducing wealth tax; cutting tax rates for the media; supporting export diversification; rationalising excise duty; etc.
The tax-free income ceiling for FY25 is Tk 3,50,000 for individual taxpayers.
Speaking about upward adjustments of the ceiling, the NBR chairman said the existing taxpayers are not showing actual income in their returns.
"If the threshold is increased, it would result in the drop-out of marginal taxpayers from the existing poor base."
He acknowledged that the number of quality taxpayers is quite low and they are always subjected to scrutiny to pay more.
Khan emphasised intensifying the enforcement of tax laws to collect more taxes.
"We are exploring the possibility of introducing an area-based enforcement strategy to treat businesses equally and ensure a level playing field for them," he noted.
He also vowed to scrap all reduced tax rates gradually and bring the beneficiaries of fiscal policy under the regular tax rates.
Responding to a question from newsmen, Khan said the "no income, no tax" policy would be promoted by withdrawing the minimum tax provision that requires paying taxes irrespective of losses or profits made by a business.
He assured that some existing disparities in the tax system would be addressed.
The revenue board chairman hinted that the upcoming budget would focus on eliminating excise duty, particularly for small deposit holders and borrowers.
He also hinted that the next year's tax policy would see more significant changes in income tax regulations compared to VAT and customs duty.
doulotakter11@yahoo.com