The National Board of Revenue (NBR) fears that revenue collection for the 2019-20 fiscal year may fall below the figures of the previous year, a first ever since the emergence of the country in 1971.
Revenue collection for the current fiscal year may stand at Tk2.20 lakh crore, posting a staggering shortfall of Tk15,000 crore compared to the collection in the 2018-19 fiscal year.
"Internal consumption will decrease even if the pandemic goes away at the beginning of the next fiscal year, dragging down industrial raw material import and production," NBR Chairman Abu Hena Md Rahmatul Muneem informed Finance Division Secretary Abdur Rouf Talukder recently.
"Against the backdrop of this situation, it will be nearly impossible to meet the Tk3.30 lakh crore revenue collection target set by the Finance Division," the NBR chairman stated in the letter.
He noted that the collection of revenue might stand at Tk2.50 lakh crore in the next fiscal year.
Rahmatul Muneem pointed out that the NBR had collected Tk2.34 lakh crore revenue in the 2018-19 fiscal year. The collection of the current fiscal may stand at Tk2.20 lakh crore by the end of the year, which is Tk15,000 crore less than the previous year's collection. The collection thus falls short compared to the previous year, for the first time since the liberation of the country.
The NBR chairman said the Tk3.50 lakh crore collection target in the revised budget for the current fiscal year would be impossible to meet if the pandemic was prolonged.
Revenue collection will fail to meet the target even if the situation starts improving at the beginning of the next fiscal year amid the virus fallout, he wrote to the Finance Division.
"Considering revenue growth in previous years, the collection will not be more than Tk2.50 lakh crore. But the target for the next year has been fixed Tk3.30 lakh crore, which will be difficult to achieve," said the NBR chairman.
In his letter to the Finance Division, he requested a rationalising of the collection target.
"Ambitious targets put field level collection officials under pressure; many give up at one stage, while taxpayers often raise allegations of harassment. On the other hand, a rational target encourages officials into achieving the goal," said the NBR chief.
The revenue board told the Finance Division that most future economic activities taken up by the government would basically focus on health, food, education and housing -- which are either outside tax coverage or have minimum charges levied.
It is assumed that the long-term effects of the virus will continue affecting normal economic activities and revenue collection, even if the situation returns to normalcy soon, Rahmatul Muneem added.