TDS Desk:

Compared to the last fiscal year (2024–25), the revenue collection target for 2025–26 has been increased significantly. As a result, the National Board of Revenue (NBR) now faces the challenge of collecting approximately 35 percent more revenue this year. Notably, the income tax target has been raised by 42.63 percent—one of the steepest increases in the NBR’s history. The Value Added Tax (VAT) target has risen by 30.49 percent, while customs duty is expected to increase by 29 percent.

In fiscal year 2025–26, the NBR must collect Tk 4,99,000 crore, compared to Tk 3,70,000 crore collected in 2024–25. To meet this ambitious goal, the NBR’s three main departments must each boost revenue by 29 to 43 percent. However, in the previous fiscal year, revenue grew by only 2.23 percent—a historically low rate. In June alone, revenue collection was 37.6 percent below target, ending the year with a 19 percent shortfall.

Analysts warn that such high revenue targets may place excessive strain on taxpayers. Dr. Fahmida Khatun, Executive Director of the Centre for Policy Dialogue (CPD), said, “Such a high target is not feasible in the current economic context. There is no dynamism in tax collection, the business environment is unstable, production costs have increased, and profits have declined—making it difficult for businesses to pay additional taxes.”

A senior NBR official, requesting anonymity, noted, “Usually, tax collection gains momentum in the final month of the fiscal year, but that didn’t happen this time. Internal unrest, weak ADP implementation, stagnant investment, and a slowdown in business activity are to blame.”

Institutional reforms within the NBR have also stalled. An ordinance intended to separate tax policy from administration, scheduled for passage by July 31, 2025, has been delayed. Dr. Fahmida pointed out that delays in reform have led to increased harassment of taxpayers, as pressure is shifted to existing payers rather than expanding the tax base.

Finance Adviser Dr. Salehuddin Ahmed remarked that the government has introduced a cost-cutting budget for 2025–26 to offset the budget deficit amid weak revenue performance.

According to the Ministry of Finance, government expenditure is expected to fall to 12.7 percent of GDP in the current fiscal year. The development budget has also been set at its lowest level in four years. Analysts caution that without realistic planning and improved transparency in the tax system, the pressure on taxpayers could negatively impact the overall economy.