Govt eyes private sector experts to help tax policy unit
Friday, 26 October 2007
Shakhawat Hossain
The government may go for outsourcing for experts from the private sector to run the proposed tax policy unit (TPU) aiming to achieve 0.4 per cent revenue growth proportionate to that of the annual gross domestic product (GDP), sources said.
Outsourcing for experts was discussed at a recent meeting held with the ministry of finance (MoF) secretary Mohammad Tareque in the chair.
Although members of the meeting viewed the outsourcing issue positively, they, however, expressed reservations about a previous decision that proposed for the TPU to be set up at the MoF.
The meeting was told that the MoF would face technical problems to accommodate the proposed TPU in its premises but the Internal Resources Division (IRD) would not encounter any such problem. Against this background, a decision has been taken to examine the setting-up of the TPU in IRD premises.
The government has taken the decision to set up the TPU in line with the recommendation of the International Monetary Fund (IMF) to segregate the policy wing of the revenue board from its executive wing.
According to the MoF officials, it is important for the government to separate the tax policy wing from the executive wing to carry on the policy reforms of the revenue board.
Citing example of other countries, they said these days policy and executive wings worked separately and that helped in achieving substantial growth of revenue income.
As the country has to reduce its dependence on foreign aid to maintain growth rate of its economy at more than 6.0 per cent, it proportionately requires at least 0.4 per cent revenue growth annually.
Although the country's revenue generation growth was satisfactory even a couple of fiscals back, it declined to less than 0.2 per cent in 2005-06 and 2006-07 fiscals, added the officials.
The IMF suggested for fundamental changes in revenue generation so that the country could achieve satisfactory revenue growth in line with the expansion of its economy.
The government implemented the IMF suggestions for setting up large tax payers unit for income tax and value added tax in the past four fiscals, said the revenue board officials.
Now, it is examining another proposal by a country's leading development partner to create two posts of member of the revenue board.
One would hold the office of member for information technology and the other for human resources, they added.
The government may go for outsourcing for experts from the private sector to run the proposed tax policy unit (TPU) aiming to achieve 0.4 per cent revenue growth proportionate to that of the annual gross domestic product (GDP), sources said.
Outsourcing for experts was discussed at a recent meeting held with the ministry of finance (MoF) secretary Mohammad Tareque in the chair.
Although members of the meeting viewed the outsourcing issue positively, they, however, expressed reservations about a previous decision that proposed for the TPU to be set up at the MoF.
The meeting was told that the MoF would face technical problems to accommodate the proposed TPU in its premises but the Internal Resources Division (IRD) would not encounter any such problem. Against this background, a decision has been taken to examine the setting-up of the TPU in IRD premises.
The government has taken the decision to set up the TPU in line with the recommendation of the International Monetary Fund (IMF) to segregate the policy wing of the revenue board from its executive wing.
According to the MoF officials, it is important for the government to separate the tax policy wing from the executive wing to carry on the policy reforms of the revenue board.
Citing example of other countries, they said these days policy and executive wings worked separately and that helped in achieving substantial growth of revenue income.
As the country has to reduce its dependence on foreign aid to maintain growth rate of its economy at more than 6.0 per cent, it proportionately requires at least 0.4 per cent revenue growth annually.
Although the country's revenue generation growth was satisfactory even a couple of fiscals back, it declined to less than 0.2 per cent in 2005-06 and 2006-07 fiscals, added the officials.
The IMF suggested for fundamental changes in revenue generation so that the country could achieve satisfactory revenue growth in line with the expansion of its economy.
The government implemented the IMF suggestions for setting up large tax payers unit for income tax and value added tax in the past four fiscals, said the revenue board officials.
Now, it is examining another proposal by a country's leading development partner to create two posts of member of the revenue board.
One would hold the office of member for information technology and the other for human resources, they added.