Tk21,930cr revenue deficit in 9 months of current FY

In the first nine months of the current financial year 2023-24, 63.5 percent of the annual revenue target has been met.

In other words, the revenue collected by the National Board of Revenue (NBR) during the time is Tk 21,930 crore less than the target.

Like every year, NBR has fallen behind in achieving the target since the beginning of the financial year. But the NBR is supposed to collect additional revenue to fulfill the conditions set by the International Monetary Fund (IMF) against the loan provided by it.

According to the IMF's terms, besides reforms in the revenue sector, additional revenue worth 0.5 percent of the Gross Domestic Product (GDP) has to be collected every year.

According to NBR sources, a total of Tk 2,59,814 crore customs and taxes have been collected during the last July-March period. During this time, the NBR’s revenue collection target was Tk 2,81,745 crore. During the nine months, an average of Tk 28,668 crore revenue was collected every month.
In the current financial year, NBR has been given a target of collecting Tk 4,10,000 crore revenue.

NBR sources said none of the three sectors-imports, VAT and income tax – succeeded to meet the target in the last nine months. Among these three sectors, the biggest shortfall in revenue collection is in the import sector, with Tk 9,079 crore revenue deficits.

The target of revenue collection from this sector in last July-March period was Tk 83,342 crore and the collected revenue is Tk 74,262 crore.
In the income tax sector, Tk 84,901 crore of revenue has been collected against the target of Tk 93,350 crore in these nine months. As such, the deficit in this sector is Tk 8,448 crore.

Deficit in VAT sector is Tk 4,402 crore. Tk 1,00,650 crore of VAT has been collected during the nine months against a target of Tk 1,05,053 crore.
If the revenue cannot be collected according to the target, the government has to reduce the expenditure in various sectors. As part of cost cutting, allocations are reduced for development projects. Because, there is no opportunity to reduce government expenditure in sectors like salaries and allowances, repayment of loan installments, and subsidies.