Revenue reform, tax digitisation, trade-clearance systems start paying

Three major steps on digitisation of the tax administration in last one year of the interim government has already started paying off through faster trade documentation and leak-plugged tax mobilisation, officials claim.

The breakthroughs are taking place by way of restoring taxpayer confidence in virtual operations instead of the loopholes-ridden manual processing moving from table to table in offices.

The digitising of revenue system has been minimizing the hassles in tax payment and expediting the release of goods from customs points.

The initiatives, if sustained, would plug the scope of underhand dealings between taxmen and taxpayers and cut time of cargo release at customs points.

The digitising includes mandatory online tax-return submission by individual taxpayers, suspending manual selection of taxpayers' files for audit, introducing mandatory receipt of import certificate, licences and permissions under Bangladesh Single Window (BSW) gateway.

Already, online tax-return submission marked nearly three times increase last year, ending June 30, 2025, as going online was mandatory for some professionals, NBR data showed.

From August 4, all individual taxpayers are required to submit tax returns online.

After the formal launch of the BSW, traders have received some 431,169 certificates, licences and permission from the online portal to get their products released from ports. 

Suspension of manual selection of tax files for audit is another breakthrough as now only selection of tax files is conducted digitally. "Taxpayers have long faced harassment on audit-selection process as it was a tool of money making by some tax officials, staffers and tax practitioners," says many a sufferer.

The National Board of Revenue (NBR) data show  15,494 tax files have been selected for audit following the concept of "tax justice" where only 0.5 per cent of tax returns of each circle have been selected for audit. To improve the audit selection, Risk-based Audit Selection Criteria would be automated soon.

Time and cost of tax payment would gradually come down, encouraging tax payment if the move continued under the next political regime, set to come through the election the current interim government moves to hold next February.

However, officials at field offices felt the need of restoring confidence among the tax officials who are still panicked, shocked and quite in low morale over the government's punitive action against reform protesters.

 An unrest in revenue administration sparked in May and June 2025 against an ordinance issued to bifurcate the NBR into revenue administration and implementation.

"Man behind the machine cannot be ignored as system has to be operated and implemented by the officials," says an expert in this field.

Though NBR's revenue mobiisation has marked one of the lowest growth, 2.56 per cent, excepting the year of Covid-19,  in the last one decade, both taxmen and businesses believe the situation would improve significantly in the current financial year if the interim government can bring back working spirit of the taxmen.

"The year 2024 cannot be compared to other normal financial years as it has gone through several challenges with its last  quarter hit directly in the tax collection," says former chief economist at the World Bank Bangladesh office Dr Zahid Hussain.

"There is no alternative to raising the tax to-GDP-ratio but reform in tax department has not marked any significant progress yet," he told The Financial Express.

On digitisation, he said the efforts had not shown any result earlier as the government made partial digitisation where taxpayers have to visit tax offices at some stage of the process of tax payment and return submission.

The BSRM Group of Companies Chairman and Chief Executive Officer, Alihussain Akberali, feels the process of online tax return should be upgraded as it takes quite a long time to fill out the forms with required inputs.

"Income-tax-return system of Singapore could be an example of digitisation where access of all records of an assessee, including bank-account information, property, CDBL, is available for the taxmen. A software should be there to verify what each assessee has furnished in the tax files and highlight gross anomalies, if any, for their investigation," he told the FE.

Talking to the FE on Saturday, NBR chairman Abdur Rahman Khan said the digitisation would pay off gradually as the NBR is now working to ensure integration and interoperability.

On allegations of partial automation, the NBR chief said,"The government's other departments would also require to digitise at the same pace so that taxmen can get all required information provided in the tax returns."

A bunch of further digitisation steps, including bonded-warehouse facility, and simplification of tax clearance for foreign nationals are underway to ease tax

payment and compliance process, he informed.

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