Let the NBR's impressive work be carried over

That Bangladesh's tax-to-GDP ratio is one of the lowest in the world is widely known. In the Asia-Pacific region this ratio is as high as 19.50 on an average and the average for the developing countries is 17-18 per cent. Bangladesh cuts a sorry figure with this proportion as low as 7.0-9.0 per cent. Experts in revenue mobilisation and economists assert that at least a minimum of 15 per cent tax-GDP ratio is essential for stimulating and sustaining economic growth. Woefully for Bangladesh, the 7.0-9.0 per cent ratio falls far short of the annual budget. Quite logically, there are calls from all around that the tax net should be expanded in order to raise the tax-GDP ratio. The sooner it is done the better. Every year the target of tax collection misses the target by a wide margin. 

It is against this background, the National Board of Revenue (NBR) has achieved quite a feat by bringing more than 131,000 new establishments under the value-added tax net. The NBR can claim credit for its performance well beyond the target set. The target was to identify 100,000 more businesses for their registration under the VAT (value added tax) regime. But it ended up bringing 31,000 more entities under the VAT system. This is inspiring because the NBR had to outlay a programme for observance of a VAT Day and a VAT Week which were complemented by an intense campaign of field activities, legal reforms and greater reliance on digital tools. The VAT Day and Week have received a boost because of the field works which were more or less absent in the past. Field activities have helped identify entities, legal reforms eased the procedure of VAT returns and digital tools helped the two initiatives by way of identifying and easing the process of VAT collection. As the single largest source of fiscal earning, VAT has a share of 38 per cent in government's total revenue. The adage that if there is a wish, there is a way fits into the very drive by the NBR. 

Apart from the impressive achievements, the campaign's symbolic value is far-reaching. After all there is a message and a lesson for the tax body. It has to think out of the box to generate revenue from taxable people and establishments. When a VAT Day and a Week are observed in the middle of the fiscal year with commendable performances, the good work should be sustained throughout the year. If performances are poor on the part of any government body, usually an excuse of manpower shortage is advanced in most cases. If more manpower is required, why not recruit the minimum number of extra hands? In such cases, the benefit is likely to far outpace the cost or money invested. 

The use of digital tools has immense possibilities. Limited use of those has produced good tiding. If a comprehensive digital national database is created, tax dodgers cannot escape the tax net. It is time the nation boasted a digital database in order to streamline the vital statistics of personal or organisational assets. In that case, no taxable entity can evade tax payment. The existing socio-economic disparities can be addressed if higher taxes are levied on the rich and affluent segments of society.