NBR's new drive to woo more taxpayers
Sunday, 17 February 2008
THE National Board of Revenue (NBR), in the face of declining revenue earning from customs duty, of late, has concentrated its efforts more on the mobilization of direct tax which for a variety of reasons has remained far less exploited than its actual potential. Last year, several teams of tax officials fanned out in Dhaka city and visited a number of markets, shopping malls and business centres to enroll new taxpayers and, at the same time, motivate businesses to pay tax. There was instant yet limited success in attaining the objective. Nevertheless, it was a good move on the part of the NBR.
The Board, according to a report published in this daily last Friday, has now launched a similar drive in other cities and towns across the country under a programme, styled, 'self-motivated new taxpayers'. Northern district town of Bogra was the place from where the NBR launched the programme a couple of days back. A total 128 people reportedly volunteered to enroll themselves as taxpayers at an interactive session attended by local businessmen and cross section of people, including women, by paying a token tax amount of Tk. 2000 each. The unique feature of the newly launched programme of the NBR was the involvement of the local chamber bodies in the motivational work.
Such campaign to motivate the potential taxpayers in areas outside the major cities like Dhaka and Chittagong to pay their tax in due amount has become all the more necessary in view of the gradual decline in revenue earning from a traditional source-customs duty-because of trade liberalization and other domestic factors. The NBR in the past was found to be rather indifferent to the task of tapping income tax revenue in due amounts from individuals and business firms in these areas. The Value Added Tax (VAT) is another area that is yet to be exploited to its full potential. High revenue income from both income tax and VAT would largely depend on the sincerity of the tax officials concerned. For decades, eligible taxpayers have, deliberately or otherwise, dodged taxes or paid less than what is due, with tax officials, in most cases, remaining unconcerned. This apathetic attitude of the taxmen coupled with potential taxpayers' lack of interest to come under the tax net has resulted in poor mobilization of tax revenue by the government. It is not at all justifiable that a country having a population of 140 million will have only 0.92 million taxpayers and a tax-GDP ratio of 9.0 per cent, the lowest in Asia.
Seemingly, imposed from the top, a change in the working pattern of the taxation department is now visible. But, despite claims about reforms, the officials are yet to shake off the approach that rather encourages the potential taxpayers to stay away from the former. However, it might take some more time for the tax officials to pick up a taxpayer-friendly approach. Besides, the people would be encouraged to part with a portion of their earning as tax at the end of year only if the amount paid to the government exchequer is well-spent for the greater benefit of the society. Unfortunately, the taxpayers have no reasons to be happy about the way their tax-money is spent or the hassles they are very often subjected to by the government officials. The government does need to bring about a visible change in the tax administration so that people can pay taxes in a hassle-free environment. The tax rates do also deserve revision, particularly in the context of the rising cost of living, so that majority of the taxpayers do not consider tax as a burden.
The Board, according to a report published in this daily last Friday, has now launched a similar drive in other cities and towns across the country under a programme, styled, 'self-motivated new taxpayers'. Northern district town of Bogra was the place from where the NBR launched the programme a couple of days back. A total 128 people reportedly volunteered to enroll themselves as taxpayers at an interactive session attended by local businessmen and cross section of people, including women, by paying a token tax amount of Tk. 2000 each. The unique feature of the newly launched programme of the NBR was the involvement of the local chamber bodies in the motivational work.
Such campaign to motivate the potential taxpayers in areas outside the major cities like Dhaka and Chittagong to pay their tax in due amount has become all the more necessary in view of the gradual decline in revenue earning from a traditional source-customs duty-because of trade liberalization and other domestic factors. The NBR in the past was found to be rather indifferent to the task of tapping income tax revenue in due amounts from individuals and business firms in these areas. The Value Added Tax (VAT) is another area that is yet to be exploited to its full potential. High revenue income from both income tax and VAT would largely depend on the sincerity of the tax officials concerned. For decades, eligible taxpayers have, deliberately or otherwise, dodged taxes or paid less than what is due, with tax officials, in most cases, remaining unconcerned. This apathetic attitude of the taxmen coupled with potential taxpayers' lack of interest to come under the tax net has resulted in poor mobilization of tax revenue by the government. It is not at all justifiable that a country having a population of 140 million will have only 0.92 million taxpayers and a tax-GDP ratio of 9.0 per cent, the lowest in Asia.
Seemingly, imposed from the top, a change in the working pattern of the taxation department is now visible. But, despite claims about reforms, the officials are yet to shake off the approach that rather encourages the potential taxpayers to stay away from the former. However, it might take some more time for the tax officials to pick up a taxpayer-friendly approach. Besides, the people would be encouraged to part with a portion of their earning as tax at the end of year only if the amount paid to the government exchequer is well-spent for the greater benefit of the society. Unfortunately, the taxpayers have no reasons to be happy about the way their tax-money is spent or the hassles they are very often subjected to by the government officials. The government does need to bring about a visible change in the tax administration so that people can pay taxes in a hassle-free environment. The tax rates do also deserve revision, particularly in the context of the rising cost of living, so that majority of the taxpayers do not consider tax as a burden.