The Finance Division has once again set overly ambitious revenue targets for next fiscal, despite the revenue board’s repeated failures to achieve set targets in the last several years.
Finance Minister AMA Muhith recently approved Internal Resources Division’s proposal of Tk3,40,774cr revenue collection target at the Fiscal Coordination Council meeting. This is 18% bigger than the current fiscal year’s budget outlay – in money terms Tk52,784cr higher.
Muhith told reporters after the meeting that the final target will be settled in February next year.
According to Finance Division sources, in October revenue collection fell short by Tk6,665cr in terms of four-month target. Revenue Board’s target for October was Tk65,459cr. Total target for fiscal year 2017-18 is Tk2,87,990cr. This revenue target is equal to 13% of GDP.
Economic think tank Center for Policy Dialogue (CPD) predicts that revenue collection will fall short by a margin of Tk43,000cr to Tk55,000cr in this fiscal, because of the government’s failure to implement the new VAT law.
According to the National Board of Revenue, the target will be Tk2,96,200cr while this fiscal it is Tk2,56,812cr. In the coming fiscal, non-NBR tax revenue will be Tk11,462cr, compared to this fiscal’s Tk8,622cr. Revenue target from non-tax sectors is Tk33,011cr next fiscal year, while this fiscal it is Tk31,179cr.
NBR wants to collect Tk1,20,000cr from Value Added Tax in the coming fiscal year, which if met would make VAT the single biggest source of tax. The second highest sector in NBR’s projection is income tax and profit, of about Tk94,000cr.
In the current fiscal year, the government’s budget is Tk4,00,266cr. This is equal to 18% of the GDP. The estimated budget for the next fiscal year is Tk4,68,200 crore, which is Tk67,934cr higher than the current fiscal year.