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Despite the growth in revenue collection after a shift in the political landscape since the July Uprising, the National Board of Revenue (NBR) has been unable to rein in the deficit at the end of the third quarter of the ongoing financial year.
Different steps to revive the economy made little difference as the gap exceeded Tk 650 billion in the nine months until March of the ongoing FY2025 financial year.
The deficit stood at Tk 580 billion at the end of February, seeing an addition of Tk 70 billion in a month.
Revenue collection is 20.38 percent behind the revised target.
Although it is behind the target, collection rose by 2.75 percent year-on-year.
According to the updated statistics of the National Board of Revenue (NBR) released on Monday, the revised target for revenue collection in the first nine months of the current fiscal year is Tk 3.22 trillion, against which, Tk 2.56 trillion was collected.
So, the deficit stands at Tk 65.66 billion.
The NBR received a revenue collection target of Tk 4.8 trillion for the entire fiscal year. Midway through the year, it was cut to Tk 4.63 trillion.
In the 2023-24 financial year, the NBR collected Tk 2.49 trillion in revenues, exceeding the previous year’s collection by Tk 68 billion (2.76 percent) for the same period.
To bridge the revenue gap, the interim government increased value-added tax (VAT), supplementary duty and excise duty on more than 100 goods and services in January. Later, the NBR changed its decision for many products in the face of demands from businessmen and other stakeholders.
After the budget was announced in June 2024, the economy began grappling with crises, including inflation, dollar crisis, and a decline in reserves. Within two weeks of the budget, the students-led Anti-discrimination Movement sparked nationwide protests and eventually led to the fall of the Awami League government in August.
Amid a deterioration of the state of law and order following the fall of Sheikh Hasina’s government, all economic indicators including imports, exports and production slowed down, while the declining trend of revenue collection stayed unchanged.
In December, however, revenue collection saw an uptick for a single month, and it continued into January. Despite the growth sustaining in February, the rate slowed down, though it climbed by 0.9 percent compared with the same month of the previous fiscal year.
March saw a “fair” growth in revenue collection as it leapt by 9.64 percent year-on-year.
According to the latest data from the NBR, revenue collection at the import level in July-March of the ongoing fiscal year was Tk 742.55 billion, up from Tk 739.77 billion year-on-year. And in line with that, the collection growth shrank by 0.38 percent.
At the local level, the revenue collected from VAT and excise duties in the first nine months of the current fiscal year was Tk 953.11 billion, which was Tk 933.61 billion in the same period of the previous fiscal year. Revenue collection increased by 2.09 percent year-on-year.
On the other hand, the income tax and travel sector collected Tk 869.2 billion in the nine months, which was Tk 822.53 billion in the same period of the previous fiscal year. Collection in this sector rose by 5.67 percent year-on-year.
In January, the NBR recorded a collection growth of 6.65 percent compared with the same period last year, after December saw a growth of 6.68 percent.
In February, revenue collection edged up by about 1.75 percent compared with the previous two months.
After the fall of the government, the law-enforcing agencies were rendered non-functional due to attacks on police, so the trade environment became fragile.
Despite paying customs duties, traders did not dare to unload goods and bring them to warehouses or production sites. This was reflected in the revenue collection in August when revenue collection dipped by 14.30 percent year-on-year.
The revenue collection in November saw a negative growth of 8.95 percent despite no major issues in the country's economy that month.