Simplify tax payment system
Income tax is the second biggest source of revenue for the government, according to our national budget, second only to Value Added Tax. Taxpayers have long complained that our tax system is complicated and has remained so, despite changes.
The Centre for Policy Dialogue, an independent think-tank, had recently carried out a survey which found that some 68 percent of people in our country do not pay taxes. Out of this 68 percent that did not pay taxes, 25 percent of people belonged to the affluent class.
This, despite 75 percent of respondents saying that they feel that our tax system favours the upper classes, while nearly half of them believed that it was overly complex.
It should be mentioned that the tax-GDP ratio in our country was only nine percent in FY 2016-2017, far below the 15 percent average among developing countries. Bangladesh’s per capita income is almost double that of Nepal’s, but our tax-GDP ratio is still lower than Nepal’s 14 percent.
The tax authorities should recognise that by simplifying our tax system it could ease the process for more people to pay taxes, which would in turn increase the government’s revenue earnings.
Md Zillur Rahaman
By e-mail
