BB governor stresses need for full digitisation of country's tax system

Bangladesh Bank Governor Ahsan H Mansur has stressed the need for full digitisation of the country's tax system, warning that corruption in revenue management will persist without a fully online value-added tax (VAT) and tax collection process.

Speaking as the chief guest at a roundtable discussion titled "Challenges and Prospects of Digital Transactions: VAT Increase Perspective", organised by Prothom Alo on Wednesday (29 January), he said, "I believe the current 15% VAT is too high for everyone to bear."

The governor also suggested that VAT should not exceed 10% from a product's import to production and sale.

He added that major reforms in revenue management would take at least two to three years, saying, "The current government will not have that time, but we will begin the process."

Addressing inflation control policies, he said, "Some say policies are not working, but I would say policy is working to control inflation. Even in developed nations, it takes 10 to 12 months to see the impact of measures. We expect to see positive results by June."

He further pointed out the sluggish growth in bank deposits, stating, "Currently, deposit growth in Bangladesh's banking sector is very low. I believe it should be at least 14-16%."

The governor said that an interoperable digital transaction platform has not progressed in Bangladesh as it was under the Ministry of Finance.

He also mentioned that the Binimoy app was linked to a company associated with Sheikh Hasina's son, Sajeeb Wazed Joy.