Finance Minister AMA Muhith announced the new initiative when he announced the budget proposal for the 2018-19 fiscal year
The government has taken an initiative to install Electronic Fiscal Devices (EFDs) at business units to ensure transparent collection of value-added tax (VAT) as VAT and supplementary duty (SD) amount to the largest portion of total revenue collection.
Finance Minister AMA Muhith announced the new initiative when he announced the budget proposal for the 2018-19 fiscal year in parliament on Thursday.
He said the target for the National Board of Revenue (NBR) for the next fiscal year has been set at Tk296,201 crore. Of this amount, Tk110,543 crore – the largest portion – will come through VAT collection, while income tax and other direct taxes will contribute Tk102,201 crore.
Import and export taxes will provide Tk32,589 crore to the national exchequer, while the SD collection will contribute Tk48,766 crore, excise duty Tk2,091 crore, and turnover tax Tk11 crore.
"As a part of digitizing the VAT administration to strengthen the revenue base, the government has taken initiatives to introduce a VAT Online System," the finance minister said.
He mentioned that 105,000 business units had already availed the online VAT registration facility.
The finance minister said the NBR collects almost 85% of the total revenue and the impetus of revenue collection has been good in recent years.
"The average growth of NBR revenue collection in this decade is more than 17%, which is the highest in last four decades. As a result, our tax-GDP ratio is increasing gradually, although as much as we would like."
The finance minister emphasized the collection of adequate revenue from internal sources to continue current economic progress. “We have emphasized collection of revenue not by increasing tax rate, but through expansion of tax base and encouraging self-compliance by reforming the existing tax system."
He mentioned that the number of registered taxpayers and return submissions had increased beyond the government's expectation.
“The number of registered taxpayers is more than 3.5 million now. I hope the number of registered taxpayers and return submissions within the next five years reaches 10 million and 8 million, respectively ,” he said.
Muhith said people's trust in the income tax system, especially spontaneous participation of the young generation in tax payment, is a positive sign.
He further said initiatives had been taken to compile the English version of The Customs Act, 1969 in Bangla, and the draft of the proposed new act was complete. “But it is not likely to be passed this year,” he added.