Written by The Banking Post
The Finance Division has proposed gradually introducing a faceless tax assessment and appeal system to reduce human discretion in tax administration, aiming to improve revenue collection, strengthen taxpayer confidence and encourage voluntary compliance.
The proposal was outlined in the Medium-Term Macroeconomic Policy Statement (MTMPS) released on Thursday, as part of a broader strategy to modernise Bangladesh’s tax system and improve fiscal resilience.
According to the policy statement, consistent implementation of these reforms could significantly enhance revenue mobilisation and strengthen the government’s ability to finance long-term development.
The proposal comes as the government faces a major revenue challenge in financing the Tk 9.38 trillion budget for FY27. The National Board of Revenue (NBR) has been tasked with collecting Tk 6.04 trillion, despite its highest annual collection so far standing at Tk 3.61 trillion.
Economists and policymakers say mobilising such a large amount of revenue within a single fiscal year will be difficult, particularly amid ongoing structural weaknesses in tax administration.
The MTMPS noted that Bangladesh has consistently faced a 13–15 percent gap between revenue targets and actual collections, with the revenue-to-GDP ratio falling to 7.9 percent in FY25, down from 8.2 percent in FY24.
In FY24, total revenue collection reached Tk 4.116 trillion, up 12.2 percent year-on-year, but still short of the Tk 4.78 trillion target. In FY25, revenue collection rose 6.2 percent to Tk 4.369 trillion, missing the Tk 5.18 trillion target by 15.6 percent.
The Finance Division said revenue growth continues to lag behind overall economic expansion, highlighting substantial untapped potential, particularly within the informal sector.
To address the shortfall, the government plans to focus on automation, tax-base expansion and broader taxpayer inclusion. The strategy aims to activate an investment–production–employment–consumption–tax cycle, allowing revenue growth without increasing the tax burden.
The MTMPS projects total revenue earnings could reach Tk 9.25 trillion by FY29, while the government targets a 15 percent tax-to-GDP ratio by 2035 to support its ambition of building a $1 trillion economy.
The policy statement also emphasised linking tax incentives more directly to job creation and technological advancement, while improving fiscal discipline and reducing inefficient expenditure.
“The centrepiece of this strategy is broadening the tax base by fostering investment through business simplification and improving the domestic business environment,” the report said.
Officials believe a more efficient, transparent and technology-driven tax administration will be crucial to transforming revenue mobilisation into a sustainable engine of economic growth.
