NBR seems not on course to attain revised target

Tk 300b shortfall in July-April period of FY 2018

Doulot Akter Mala | Published: June 03, 2018 09:48:34 | Updated: June 03, 2018 18:37:38

Internet photo used for illustrative purpose only

The National Board of Revenue (NBR) is likely to miss even the revised tax revenue collection target set for the current financial year, 2017-18.

The shortfall in tax revenue collection stood at Tk 300 billion in the first ten months against the revised target, according to provisional data of the NBR.

The size of shortfall has been gradually increasing.

Officials said the NBR may miss the revenue collection target this fiscal year despite downsizing the target.

They said every year the government sets on tax revenue collection target, which is 30 per cent higher than that of the previous year.

The original tax revenue collection target for FY 2017-18 was Tk 2.48 trillion.

The Ministry of Finance (MoF), later, cut it down to Tk 2.25 trillion, looking at tax collection trend.

However, the NBR collected Tk 1.60 trillion tax revenue in the July-April period of the FY '18 against its revised target of Tk 1.90 trillion for the period.

The revenue collection growth was around 14.28 per cent, on an average, in the last five fiscal years.

All the three wings of the NBR missed their respective revised targets.

In July-April, the Income Tax Wing experienced the highest shortfall, amounting to Tk 160 billion, against its revised target.

The VAT Wing missed its target by Tk 90 billion and the Customs Wing by Tk 50 billion.

The officials concerned said the government should analyse the average growth rate of tax revenue collection during the last 26 years before fixing its target.

"Every year, the government sets an ambitious tax revenue collection target without taking GDP growth and inflation into consideration," said a senior NBR official.

The original revenue collection target for the NBR was set with an expectation that revenue would see a 45 per cent growth over that of the last year, he also said.

The revised target for the current fiscal year has been set anticipating a 32 per cent growth over the actual tax revenue collection last year, he added.

For the upcoming fiscal year, 2018-19, the government is expected to propose a Tk 2.96 trillion revenue collection target for the NBR, eyeing a 33 per cent growth.

The target is Tk 710 billion higher than that of the revised one for the current fiscal year.

The officials said the VAT collection target would be the highest among the NBR's three wings in the upcoming fiscal.

The government has set a Tk 1.10 trillion VAT collection target for the fiscal year 2018-19 against the revised target of Tk 830 billion for the current fiscal.

The income tax collection target has been set at Tk 1.02 trillion, and the customs duty collection target at Tk 840 billion for the upcoming fiscal.

The revised target for income tax and customs duty collection for the current fiscal is Tk 780 billion and Tk 640 billion respectively.

The NBR official said the proposed target for FY 2018-19 is also ambitious like the previous financial years.

He also said the NBR would focus on compilation of actual revenue collection data from this year.

The NBR started compiling the revenue collection data through cross verification with the Controller General of Accounts (CGA) office.

"The process of tax revenue data compilation has become slower this year because of the application of this procedure."

"However, the cross verification would help the government to minimise the mismatch in tax revenue collection data between the entities," he added.

In the last FY, there was a serious mismatch between the NBR's revenue collection data and the CGA's actual figure.

The NBR recorded Tk 1.85 trillion revenue collection in FY 2016-17. But according to the CGA, the actual collection was Tk 1.71 trillion.


Share if you like