Dhaka: National Board of Revenue (NBR) Chairman Md Abdur Rahman Khan announced today that the government aims to gradually phase out tax exemptions, suggesting a potential shift away from this practice in the future. “We don’t want to incur further tax expenditures. It is time to move away from the culture of tax exemptions,” Khan stated during a pre-budget meeting held at the NBR conference room in the capital.
According to Bangladesh Sangbad Sangstha, the meeting saw participation from representatives of key financial and tax organizations, including the Institute of Cost and Management Accountants of Bangladesh (ICMAB), Institute of Chartered Accountants of Bangladesh (ICAB), Institute of Chartered Secretaries of Bangladesh (ICSB), Bangladesh Tax Lawyers’ Association (BTLA), Bangladesh VAT Professional Forum, and the Retired Tax Officers Welfare Association. Khan urged stakeholders to avoid advocating for tax exemptions, emphasizing that income tax applies only to profits and does not lead to financial ruin.
Khan criticized the prevalent mindset of seeking tax exemptions as a prerequisite for business ventures. He highlighted that investment decisions should focus on economic viability, geographical advantages, and potential returns, rather than relying on tax relief. “There is no reason to fear income tax. The perception that industries should only be established if tax exemptions are granted is incorrect,” he noted, stressing the importance of reasonable returns as the key factor for investment.
Addressing foreign-funded government projects, Khan stressed the necessity of structural changes in agreements to ensure proper tax collection. He pointed out that without these changes, significant tax revenues would continue to be missed. He highlighted the importance of contracts specifying that tax payments are the responsibility of contractors and called for thorough vetting of agreements to prevent tax evasion. Khan identified tax evasion as a pressing issue in this sector and called for broad discussions to address it.