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Bangladesh Gearing Up for New Era of Taxation

In the run-up to Vision 2041 and the attainment of the 2030 Sustainable Development Goals, the Government has initiated a series of programs aimed at entering a new age of taxation from 2020-21 fiscal year.

"We must step up revenue mobilization and streamline the country's financial system," said a senior official at the Ministry of Finance.

To this effect, he said, the government has no option but to create a strong , functional and transparent Department of Income Tax.

Online Tax, Tax Return submission

The government has already taken an initiative to modernize the tax department's Bangladesh Integrated Tax or BiTAX system that includes digital tax payment as well as facility for submitting online tax returns.

In order to popularize online tax payment and filing of tax returns online, Finance Minister AHM Mustafa Kamal has announced a tax refund of Tk 2,000 to all taxpayers who must submit their income tax returns first online.

"I hope this will highly encourage the taxpayers to submit their income tax returns online, which will in turn accelerate the process of digital transformation of the Income Tax Department," he said in his budget speech.

Tax Department to get Access to Govt Database

According to the budget documents, plans have been made to give the tax department access to a database of different governmental, autonomous and private organizations through system integration and system interoperability.

"Special priority will be given to issues related to the virtual economy , international taxation and auditing," she added.

Establishing Tax Academy

The Finance Ministry official mentioned that the government is also planning to increase the number of taxpayers by making the ongoing survey programme more intensive and technology-supported.

"Measures have also been taken to establish a tax academy per excellence in the country to enhance professional skills of taxmen," he said.

He said formulation of a new business development-friendly and modern Income Tax Act is also underway.

"Programmes have also been taken to make people compliant to tax matters."

Policy to Reward Tax Payers

The budget document stated that a policy will be formulated to recognise and reward the tax officers who will demonstrate extraordinary professional feats, including identification of new taxpayers and mobilisation of revenue.

The Finance Ministry official said legal changes arising out of the new amendments and implementation of these amendments will enhance the capacity of the tax department to discharge the responsibility vested on it.

As a result, he said, the pace of revenue mobilisation will be accelerated, and this will play a positive and effective role in achieving the overall development goals.

Revenue Collection Target

The total revenue collection for the planned budget for the 2020-21 fiscal year is expected to be Tk 378,000 crore, with the NBR contributing Tk 3.30,000 crore.

Revenues from non-NBR sources were estimated at Tk 15,000 crore, while non-tax revenues were estimated at Tk 33,000 crore.

Of the grand amount for the NBR, Tk 103,945 crore will come from income, profit and capital tax, while Tk 125,162 crore will be contributed by VAT, supplementary tax will provide Tk 57,815 crore, Tk 37,807 crore will come from import duty, Tk 55 crore from export duty, Tk 3,686 crore from the excise duty and Tk 1,530 crore as other taxes.

Source: UNB

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