B Mirror Report: The National Board of Revenue (NBR) has backed away from several proposed tax measures for the FY2026-27 budget, including the introduction of a wealth tax, advance income tax on motorcycles and battery-powered auto-rickshaws, and a special provision to legalize undisclosed income in the real estate sector.

According to NBR sources, the government had initially planned to introduce a wealth tax as part of efforts to increase revenue collection, with an estimated revenue target of Tk 20,000 crore. However, the proposal did not receive approval from the government’s higher policy-making level and has been shelved for the time being.

Under the proposed framework, taxpayers with net assets of up to Tk 4 crore would have been exempt from the tax. Higher asset holders would have faced tax rates ranging from 0.25 percent to 1 percent, depending on the value of their declared net wealth.

An NBR official, speaking on condition of anonymity, said the proposal had undergone extensive review and was designed to align with international standards. However, authorities ultimately decided not to proceed with the measure at this stage.

The government has also abandoned plans to impose advance income tax (AIT) on motorcycles and battery-powered auto-rickshaws following public criticism. The proposal had included taxes on motorcycles above 110cc and annual advance taxes on electric auto-rickshaws operating in city corporation, municipal and union areas.

The issue sparked protests by ride-sharing drivers and motorcycle users, while criticism also emerged on social media. Although the tax proposal has been withdrawn, owners of motorcycles with engine capacities above 165cc will still be required to obtain a Taxpayer Identification Number (TIN).

Another proposal that has been dropped involved offering a conditional opportunity to legalize undisclosed or “black” money invested in land, apartments and commercial properties. The measure would have required buyers and sellers to declare actual transaction values and pay taxes at prescribed rates.

Tax experts have expressed mixed views on the withdrawn proposals. Snehasish Barua, Director of SMAC Advisory Services, said wealth taxes can help reduce inequality and broaden the tax base, but they may also create administrative challenges and encourage capital flight if not properly implemented.

Meanwhile, Policy Exchange Bangladesh Chairman M Masrur Riaz welcomed the decision to postpone the wealth tax, suggesting that such a measure requires long-term planning and advance notice. He also argued that allowing the legalization of undisclosed income would do little to boost revenue while potentially encouraging corruption.

The changes indicate a more cautious approach by the government as it finalizes revenue measures for the upcoming fiscal year’s budget.