Land reg taxes may fall in next budget

Land-registration taxes may decrease in the next budget for fiscal year 2025-26, National Board of Revenue (NBR) Chairman Abdur Rahman Khan said on Tuesday.

"We would consider not increasing the existing taxes (on land), rather we would make it tolerable," he said, responding to a pre-budget proposal to update the mouza rates for land and property deals.

"If we lower the taxes, the number of registration will increase and eventually the transaction volume might increase," he said.

The NBR chief was addressing a pre-budget meeting with professional bodies, including the Institute of Chartered Accountants of Bangladesh (ICAB), at its head office in the city's Agargaon area. He said the NBR has started working to address the taxation on land registration issue.

Representatives from different stakeholders constitute the mouza rates committee. There are different types of taxes on property deals, including registration cost, stamp duty, income tax and local government tax, among others.

"Whatever other stakeholders do, we would lower our tax," said the NBR chief, adding that it would give a message to others too.

His remarks followed a proposal submitted at the meeting by Snehasish Barua, a fellow member of the ICAB.

In his submission, Mr Barua said that since mouza rates were not updated, the actual market rates were not exposed in the property deals, leading to creation of undisclosed money.

Responding to other proposals, the NBR chairman also said the extent of tax exemption will decrease gradually. "Don't urge for tax exemption afresh. Whatever exemptions exist now, we would gradually cut them," he said.

Quoting a statement of Syed Mujtaba Ali that 'no one becomes bankrupt buying books', the NBR chief said: "No one becomes bankrupt after paying taxes-we haven't heard such a statement."

As tax is paid on income and not on expenditures, there should be no problem in paying tax, he said, adding that every business runs keeping the issue in their mind.

In addition to the ICAB, representatives of the Institute of Chartered Secretaries of Bangladesh (ICSB), Bangladesh Tax Lawyers Association, and Bangladesh VAT Professional Forum were present at the meeting. They called for government measures to enhance digitalisation and automation.

ICAB President Maria Howlader and ICMAB President Mahtab Uddin Ahmed were present at the meeting, among others.

ICAB called for rationalisation of effective tax rates, simplification of the definition of services export, and raising investment for tax officials' performance. The ICMAB president requested the government to incentivise any sort of digitalisation.

He, however, said that with digitalisation, issues like data privacy and data integrity should also be ensured.

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