Revenue collection crashed more than 55 per cent in April, revealing the massive hit the Bangladesh economy has taken from the coronavirus outbreak in the country.
The National Board of Revenue (NBR) collected Tk 8,789 crore last month, the lowest monthly earnings in recent times. April's receipts were down 57.32 per cent from even the previous month, showed the preliminary data from the NBR.
This is the clearest indication yet of the outsize impact the rogue virus has had on the economy since the first confirmed cases of COVID-19 were reported on March 8.
The breakneck speed at which it was spreading through the country has prompted the government to declare countrywide shutdown since March 26 to put the brakes on its contagion.
Seeing that the country saw its highest single-day surge in terms of both fatalities and infections suggest that the government measure is not succeeding but it is impairing the economy by leaps and bounds.
The stay-at-home order has resulted in simultaneous supply and demand shocks, with production, consumption, trade and investment all at a standstill.
In April, earnings from import duty plunged 56.64 per cent year-on-year to Tk 2,652 crore.
VAT receipts crashed 51.78 per cent to Tk 3,872 crore and income tax receipts 58.34 per cent to Tk 2,265 crore.
Revenue generation had grown 8.25 per cent in the July-March period of the fiscal year paced by the increased collection of advance corporate tax and higher receipts of indirect tax value-added tax (VAT).
But the growth nosedived to 0.64 per cent in the July-April period thanks to the deadly pathogen.
April's collections take the NBR's earnings in the first 10 months of the fiscal year to Tk 173,796 crore, missing the target by a staggering Tk 61,999 crore, or 26.29 per cent.
Earnings from import duty dropped 4.54 per cent to Tk 50,637 crore and missed the 10-month target by 28.58 per cent.
Income tax collection rose 6.44 per cent to Tk 55,175 crore, which is Tk 23,927 crore shy of the target during the period.
Receipts from VAT, the biggest source of revenue for the state coffer, rose 0.26 per cent to Tk 67,983 crore, but still missing the target by 20.76 per cent, NBR data showed.
Subsequently, the government has revised downwards the revenue generation target for the NBR by about 20.5 per cent to Tk 300,500 crore.
The revenue collection target from import duties has been set at Tk 85,221 crore. It is Tk 108,600 crore from VAT sources and Tk 106,679 crore from income tax.
Normally, revenue generation picks up in Bangladesh at the fiscal year nears its end. In the past several fiscal years, the NBR posted an average revenue generation growth of 13.16 per cent.
But such growth is impracticable this time.
The pandemic may inflict a minimum revenue loss of 2 per cent of GDP, said the Asian Development Bank recently.