The government is re-examining possible tax evasion by major industrial groups. At the same time, initiatives have been taken to strengthen revenue collection in the face of three major challenges - dealing with the macroeconomic crisis, implementing the election manifesto and increasing expenditure pressure on fuel imports due to the Middle East war.
Finance Minister Amir Khasru Mahmud Chowdhury told reporters after a meeting with officials at the National Board of Revenue (NBR) building in Agargaon in the capital on Wednesday.
He said that the investigation that was started during the interim government into allegations of tax evasion by several major industrial groups known to be close to the Awami League government is now being reviewed anew.
The minister said: “This is not just one issue, many issues have been discussed. Everything is now under review.”
In August 2024, after the interim government led by Dr. Muhammad Yunus took office, the NBR’s Central Intelligence Cell started investigating allegations of tax evasion against several industrial groups including Beximco, Summit and S Alam. Some arrears of taxes were also collected at that time.
Regarding the budget preparation challenge facing the new government, Amir Khasru said: “The economy that we inherited is not in a very good condition. The economy has to be rescued from there. At the same time, the promises made to the people in the election manifesto have to be implemented.”
“On the one hand, the economy has to be salvaged, and on the other hand, the promises made in the manifesto have to be implemented. On top of that, fuel has to be bought at an excessive price due to the war in the Middle East. All in all, it is a three-way or three-pronged challenge.”
In this situation, he mentioned that resource mobilization is very important to increase revenue collection. The minister said: “If resource mobilization is not done, it will not be possible to meet these goals.”
Regarding Bangladesh’s possible LDC graduation this year, he said, the matter will currently go to the United Nations Economic and Social Council (Ecosoc) for consideration and if it gets approval from there, it will be presented to the United Nations General Assembly.
The Finance Minister also commented that the government should move from a debt-based economy to an investment-based economy to increase the tax-GDP ratio. He said that the government does not want to keep the economy running by printing money; rather, it aims to create employment and increase economic growth by attracting domestic and foreign investment.
The Finance Minister also said that it is important to ensure the continuity of policies to increase investor confidence. “In our country, it is often seen that after formulating a policy, it is changed within a few days, which sends a negative message to investors. We want the policies to be stable in the long term, so that investors can plan with confidence.”
Senior officials of the Income Tax, VAT and Customs departments, including NBR Chairman Abdur Rahman Khan, were present at the meeting.
'Will not print money indiscriminately to run economy’
The government will no longer follow the path of printing money indiscriminately to keep the economy running. Rather, emphasis will be placed on strengthening the economy by increasing domestic and foreign investment and creating employment, said the Finance and Planning Minister.
He also said that the government is now giving more importance to an investment-based economy instead of a debt-based economy. The government wants to get out of the tendency of printing money indiscriminately to keep the economy running.
He said that to increase the tax-GDP ratio, the economy must first be strengthened. And the main source of that strength will be increased domestic and foreign investment.
Assuring that frequent changes in policies will be stopped to restore investor confidence, the Finance Minister said that initiatives will be taken to keep the policies unchanged for a specified period so that investors can make long-term plans. In addition, steps are being taken to ease investment by reducing major ‘deregulation’ or legal and administrative complications.
He said that restoring order in the financial sector and capital market is one of the government’s priorities.
Regarding the export sector, he said, the government is thinking of providing facilities like bonded warehouses and back-to-back LC to other potential sectors instead of relying only on the ready-made garment sector.
