Al Amin :
The National Board of Revenue (NBR) wants to increase legal enforcement in ensuring compliance with collecting taxes to meet an ambitious revenue target set by the government for the upcoming fiscal year.
Special directions for the legal enforcement in tax system and taxpaying companies or individuals are likely to be given priority in the budget to be placed on June 9, NBR officials said.
The government has set the revenue target worth Tk 3.7 trillion for the fiscal year.
Experts, however, said tax compliance will not be ensured without increasing logistic support, sufficient training for tax officials to develop capacity, a massive administrative reform, taxpayers’ confidence and offices at upazila level.
Dr Zahid Hussain, former lead economist of the World Bank Dhaka office, told The New Nation on Monday, “Specific directions are needed to improve compliance with tax policy and administration as there is a huge problem.”
“There are problems in tax rate and structure. This should be addressed first. Besides, proper automation in tax assessment and collection must in improving compliance,” he said.
Prof Dr Abu Eusuf, Executive Director of Research and Policy Integration for Development (RAPID), Bangladesh, said, “Introduction of hassle-free and simplified tax system, widening tax net and resource mobilization are required to increase revenue collection.”
NBR should take initiative to bring at least one crore people under tax net to reduce pressure on the regular taxpayers, he said.
The officials said protecting people’s health, income, and jobs from the worst of the Covid-19 pandemic and impact of Russia-Ukraine war has required substantive increases in public expenditures.
Besides, as levels of debt in the country upward trajectory that began well before the pandemic, fiscal space for development spending is shrinking.
Hence, strengthening domestic resource mobilization has become an urgent priority in the political and economic agendas of the government, they added. The need to raise more revenue in a better way is clear and efforts to raise revenue should be strengthened to address the biases of tax systems that exacerbate inequality, they said.
Accelerating the move to a digital revenue administration will underlie this undertaking, they said.
For an example, they said, only 20,816 companies have filed their tax returns till May 26 and a number of taxpaying companies have failed to submit returns for not ensuring compliance in counting tax.
The companies have also failed to provide sufficient documents that require for the Document Verification System (DVS), newly introduced way to submit corporate returns, they said.
Resolving the crisis, NBR will give emphasis on increasing legal enforcement in order to ensure compliance in this regard, they said.
Dr Syed Aminul Karim, former member (Tax) of the NBR, told The New Nation on Monday, “Ensuring compliance for both tax collectors and payers is urgently needed. Otherwise, the big revenue target will remain a dream for the revenue board.”
Tax evasion will be reduced sharply, if NBR is able to ensure compliance in collecting tax, he said.
