Calls grow for urgent overhaul of revenue board

Despite repeated calls for reform, the National Board of Revenue (NBR) remains largely unchanged, leaving unresolved tensions between its policy and administrative functions.

At the heart of the debate is the separation of revenue policy from revenue administration, a recommendation made by the NBR reform advisory committee after consultations with businesses and stakeholders.

Yet, the authorities have failed to act, fuelling frustration among experts who warned that the status quo threatens both fiscal stability and economic growth.

The concerns came to the fore once again at a roundtable in Dhaka on Saturday, when former NBR officials, business leaders, and policy analysts urged immediate reforms.

Experts cautioned that continued inaction could exacerbate inefficiencies within the country's revenue system.

"We recommended the separation of revenue policy from administration, but the NBR has not been restructured accordingly. If coordination fails, existing inefficiencies may worsen," former NBR member and reform advisory committee member Md Farid Uddin said.

He was addressing the roundtable titled 'NBR Reform - Shaping Towards an Effective Revenue Policy and Management System in Bangladesh', organised by the Metropolitan Chamber of Commerce & Industry, Dhaka (MCCI) at Police Plaza in the city.

He urged business leaders to raise the issue in various forums to build pressure for reform, noting that the committee's proposals were developed after reviewing more than a decade of feedback from businesses and stakeholders.

The final report was shared with 75 organisations, including political parties such as the BNP and Jamaat.

"Only the Foreign Chamber gave a substantial response," Farid Uddin said. "We received partial input from the Dhaka Chamber, MCCI, and ICMAB. No other organisations engaged. Without national consensus, pushing for reform is difficult."

Former NBR Chairman Mohammad Abdul Majid echoed the need for inclusive reform underpinned by political will. "We can draft policies and ordinances, but without political commitment, none of it matters," he said.

He also criticised the current income tax law introduced during the previous administration, noting that while it claims to be a direct tax policy, it functions more like an indirect tax system due to its complexity and loopholes.

Majid added that one of the principal reasons for separating tax policy from administration was to enable private-sector input in policy formulation. "We proposed mandatory inclusion of private-sector representatives and recommended that tax policies remain unchanged for at least five years," he observed.

Inamul Haq Khan, Senior Vice President of the BGMEA, cautioned that mere structural changes would not resolve the NBR's core problems. "Corruption must first be addressed," he said, stressing the need for long-term policies and mandatory stakeholder consultation in drafting laws or regulations.

BKMEA President Mohammad Hatem criticised existing tax rules for export-oriented industries, describing them as "unlawful and a violation of human rights." He pointed to unnecessary delays and costs caused by excessive certification requirements, particularly for the import of capital machinery.

MCCI President Kamran T Rahman highlighted widespread tax evasion and weak enforcement. "Fewer than 3 per cent of people pay income tax. Institutional weaknesses and political interference undermine tax administration," he said. He also noted the system's complexity and inconsistent enforcement.

Former MCCI President Nihad Kabir criticised the slow pace of automation in customs operations, remarking: "It's like the horse is riding while the man is walking."

She added that Bangladesh's automation efforts often attract ridicule in international forums.

Policy Exchange Bangladesh Chairman Masrur Reaz added that inadequate government funding is hampering essential development in infrastructure, healthcare and human capital.

"Institutional weaknesses also limit the private sector's ability to access services efficiently," he said.

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