Income tax receipts rise, but short of target

Income tax collection grew 9.66 percent to Tk 24,031 crore in the seven months to January, although the gap between the target and collection widened, according to provisional data from the National Board of Revenue.

The tax collector aims to collect Tk 29,288 crore in July-January: collection was Tk 5,257 crore short of the target.

Overall direct tax collection, including travel tax, stood at Tk 24,558 crore during the period, up 9.66 percent year-on-year, according to the NBR.

Taxmen said growth in tax collection did not pick up further due to slim bank profitability owing to a cut in the lending rate and a sluggish business environment.

A slow pace in the implementation of the annual development programme is also a reason for lacklustre growth in income tax collection, according to taxmen.

“We hope the withholding tax collection will rise in the coming months as ADP implementation will gain momentum," said an NBR official.

A majority of the 31 tax zones logged taxes below the target.

The Large Taxpayer Unit, which accounts for the highest amount of revenue among all zones, collected Tk 7,050 crore in July-January, falling Tk 1,899 crore short of the target.

“Profits in the corporate sector did not improve this fiscal year. In the major sectors such as banks and telecom, profits have declined in most cases," said Ahsan H Mansur, executive director of Policy Research Institute.  Banks' income might rise due to an uptick in the credit flow following reduced lending rates, he added.

Revenue collection would be affected unless ADP implementation picks up in the remaining months of the current fiscal year, he said.