NBR set to miss tax collection target again

The revenue board is likely to fail to reach the tax collection target for the sixth consecutive year in the current fiscal year.

Collection grew 18 percent year-on-year to Tk 161,234 crore in July-April of 2017-18, according to data from the National Board of Revenue.

Now the NBR would need to clock 39 percent growth to achieve the revised collection goal of Tk 225,000 crore in the final two months of the fiscal year ending June 30.

In case of actual target of Tk 248,190 crore, the tax authority will have to accomplish 54 percent growth – a task that would be impossible for the taxmen, analysts said.

At best Tk 210,000 crore could be collected at the end of the fiscal year, said Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh.

If the target is missed finally, this will be the sixth consecutive fiscal year for the NBR to fail to attain both the actual and revised tax collection targets set by the government. The target was reached for the last time in 2011-12.

Since then, the gap between the target and the accomplishment has been widening every year.

In 2012-2013, the collection fell Tk 8,927 crore short of the original target and the gap rose to Tk 31,654 crore in the last fiscal year, according to finance ministry data.

Analysts say the revenue collection goals are set at much higher levels without taking into account the existing capacity of the NBR and speeding up reforms.

“Without reforms, the revenue target will never be achieved,” said Mansur.

The economist said Bangladesh would never be able to collect the revenues required for a middle-income country unless there is the highest level of political commitment.

Earlier this week, the Centre for Policy Dialogue (CPD) said the mismatch between the revenue generation target and the actual attainment has been a regular phenomenon since 2001-02 except for two years. The think-tank forecasts Tk 50,000 crore revenue shortfall in 2017-18.

An official of the NBR said tax collection would reach Tk 40,000 crore to Tk 45,000 crore in May and June based on the normal trend. “We are trying to speed up the resolution of some tax disputes to increase the collection,” he said.

The NBR is also trying to realise a portion of the arrears from state-owned Petrobangla and Bangladesh Petroleum Corporation which together owe Tk 25,000 crore to the revenue administrator.

“We expect to get Tk 12,000 crore to Tk 15,000 crore through book adjustment,” the official said, adding that the total receipt would be Tk 215,000 crore to Tk 220,000 crore if the book adjustment could be done.

The government plans to ask the NBR to raise Tk 296,201 crore in revenues in 2018-19, up 32 percent on the revised target in the outgoing fiscal year.