IMF raises Bangladesh's revenue growth target
To achieve the target, the NBR will now have to collect total revenue of around Tk4,60,000 crores in the current fiscal
The International Monetary Fund (IMF) has set Bangladesh's revenue growth target for the current fiscal to an amount which is 27% higher than what was collected last year.
In the last fiscal year 2023-24, the National Board of Revenue (NBR) collected revenue of Tk3.62 lakh crores. To achieve the target, the NBR will now have to collect an additional 0.6% revenue of the GDP – meaning it has to collect 27% more revenue than last fiscal. As such, the NBR will now have to collect total revenue of around Tk4,60,000 crores in the current fiscal.
The visiting IMF delegation disclosed the target during a meeting with NBR chairman at the NBR office in the capital's Agargaon today (4 December).
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In addition, the lender has also proposed to increase the standard date single rate to 15% without keeping the VAT rate different. Besides, it also asked for cancellation or repeal of tax exemptions in sectors which have been granted through special statutory regulatory orders (SROs).
A senior official of the NBR, preferring anonymity, confirmed the matter to The Business Standard.
The NBR, however, considers the revenue growth target to be "incredible". After the meeting with the delegation, speaking at an event in the capital's Gulshan, the NBR chairman said the target given by the IMF is incredible.
However, responding to a query from reporters, the NBR chairman declined to disclose the target.
Talking to TBS, the NBR official said the NBR has expressed its displeasure over revenue collection. "To achieve the target they have given us, an additional 27% will have to be collected. This is not possible in the current situation."
The NBR data also shows that the revenue collection situation is not as expected. In the four months from July to October of the current fiscal year 2024-25, the revenue collection has decreased by 1% compared to the same period of the last fiscal.
In addition, the economists have also opined that the IMF's new target is not realistic.
Dr M Masrur Reaz, chairman of Policy Exchange Bangladesh, told TBS that to achieve the new target, the tax to GDP ratio should be increased.
"Whereas the 0.5% of the GDP has not been achieved before, it is not realistic to aim for a 0.6% or 27% increase in revenue.
"Currently, there is economic slowdown and uncertainty due to political changes. GDP growth is also forecasted to be 4%-4.5%. It will be difficult to achieve such a large target," he added.
