HARASSING taxpayers is a common factor in our revenue administration discouraging honest taxpayers and also keeping a large section of taxable population with taxable income out of the tax net for fear of harassment. The New Nation has published a report on Wednesday on the country’s complex but faulty tax system identifying some loopholes ahead of the forthcoming national budget. It has primarily held corruption in revenue administration and absence of good governance as the main twisting factor put to failure serious efforts by the National Board of Revenue (NBR) to bring effective reform to the system to turn it into more efficient and a fairly based tax system based on automation.
We share experts views as incorporated in the report as to how the tax system may be reformed to make it inclusive and broad-based and yet simple and transparent to achieve the optimal level of revenue. As it is the case, the rich and wealthy in Bangladesh are paying more taxes as the tax administration is yet to exploit personal income and property taxes from the lower segment of people. Allegations also galore to the fact that a section of tax officials unnecessarily harass taxpayers to extort money discouraging potential taxpayers and also depriving the government from a lion share of the fairly estimated revenue earning. Some others are also working in nexus with individuals and big houses and the case for automation is more urgent to foil underhand deals in revenue collection. We take with positively the introduction of e-tax identification number (e-TIN) and more it expands, there will be less tax frauds depriving the nation. The country has around 60 lakh people with taxable incomes while existing taxnet covers only 15 lakh. We hope it will cover more people soon.
We believe the introduction of tax fair in the capital and district towns is going a long way to make the tax system popular. The fact that Bangladesh’s tax-GDP ratio at 9.5 percent is quite low compared to other South Asian countries. This also demands complete overhauling of our tax system both in term of policy regime and effective governance.
We suggest that the government should stop whitening of black money as it earns more bad name without enough money in return. Moreover, tax relief through bonded warehouse facility and tax holiday need to be carefully looked into in term of how much they benefit the country as against gains by individuals. Tax reform is a long way but we believe that it would continue while the authorities should also pay attention to ensure quality of public expenditure made from taxpayers’ money.
