B Mirror Desk : With revenue collection growth reaching its lowest level since the fiscal year 2019–20, Bangladesh is expected to have its largest revenue deficit in five years, since the start of the Covid-19 pandemic.
The bleak situation has been ascribed by National Board of Revenue (NBR) officials to the impasse brought on by officials’ protests over a government proposal to divide the NBR.

The current FY25’s July-April quarter saw revenue collection rise by just 3.24%, the weakest growth since the 2019–20 fiscal year, according to NBR data. The revenue collection throughout the ten-month period was a startling 38% short of its goal.

According to NBR officials, the agency’s income collection increase has generally exceeded 14% over the previous 50 years. The lone exception was FY20, which witnessed an extraordinary edgrowth of 1.96% due to COVID-19. The latest FY24, on the other hand, saw an increase of 15.44%.
According to a senior NBR official who spoke to media on condition of anonymity, “May and July usually see higher revenue targets. However, it is anticipated that revenue collection in May will suffer greatly as a result of the officials’ continuous protests. Therefore, there is a good chance that this fiscal year will have the slowest growth since FY20, he continued.

Since the start of the current fiscal year, student-led rebellions, the overthrow of the Sheikh Hasina administration, and a decline in law and order have made it difficult to collect taxes. Revenue collection suffered a setback in April, despite a minor rebound from December.
NBR officials are especially concerned that May’s revenue collection may be negatively impacted by the demonstrations against the NBR’s possible dissolution. Stakeholders fear that a protracted crisis may result in more detrimental effects on revenue collection and substantial losses for enterprises and trade, especially because officials are prepared to essentially stop import-export operations as of right now.

NBR data shows that just Tk287,257 crore was collected in the first 10 months of FY25, compared to a target of Tk358,732 crore. In comparison to the period’s aim, this indicates a Tk71,476 crore shortfall.
Tk4,80,000 crore was the original goal for the current fiscal year; however, it was subsequently reduced to Tk4,63,500 crore. Even though April’s collection increased by 7.40%, it was still Tk5,810 crore below than the target.

In the meantime, estimates from the research group Centre for Policy Dialogue (CPD) suggest that the entire income gap for the current fiscal year may amount to Tk1,05,000 crore.
“Due to the NBR officers’ protests in May, the revenue collection gap is anticipated to expand further and will be even lower than the inflation rate,” Towfiqul Islam Khan, a senior research fellow at CPD, told media.
He cautioned that the tax-to-GDP ratio may continue to fall and that the International Monetary Fund (IMF) may put more pressure on the country if the projected increase in revenue collection is not realized.