Dhaka: Centre for Policy Dialogue (CPD) today urged the National Board of Revenue (NBR) to establish an expert committee comprising tax professionals, chartered accountants, and business representatives to regularly review and update the list of allowable deductions, expenditure caps, and definitions related to taxable income.
According to Bangladesh Sangbad Sangstha, the private think tank observed that firms usually report their accounting profit in financial statements and taxes are assessed based on taxable profit, which is calculated differently. CPD noted that the presence of advanced tax, minimum tax, incentives, exemptions, and deductions leads to differences between accounting and taxable profit, affecting a firm’s effective tax rate compared to the stipulated corporate tax rate.
The think tank made this observation at a dialogue titled “Reform in Corporate Tax and VAT: A Justice Perspective for NBR”, held at a hotel in the city. NBR Chairman Md Abdur Rahman Khan FCMA attended the workshop as the chief guest, while Dr Muhammad Abdul Mazid, Chair of the NBR Reform Advisory Committee, and Syed Mushfequr Rahman, NBR Member (VAT Audit) (Current charge), attended as special guests.
Key figures such as Farid Uddin, a Member of the NBR Reform Advisory Committee, Mohammad Hatem, President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), and Md. Abul Basher, Joint Secretary of the Finance Division under the Ministry of Finance, were guests of honour. Chartered Accountant Mohammad Zahid Hossain FCA, President of the Dhaka Taxes Bar Association A. H. M. Mahbubus Salekin, and NBR First Secretary (VAT Supervision and Taxpayers Services) Md Moshiur Rahman participated as discussants.
CPD Research Director Dr Khondaker Golam Moazzem delivered the welcome speech, while Country Director of Christian Aid Bangladesh Nuzhat Jabin delivered the introductory remarks. CPD Senior Research Associate Tamim Ahmed delivered the keynote speech.
Highlighting recent advancements, Abdur Rahman Khan mentioned that the NBR has introduced an automated system allowing VAT-registered manufacturing companies to file their VAT returns directly from their ERP software with a single click, integrating with the iVAS (Integrated VAT Administration System).
In his presentation, Tamim Ahmed emphasized the need to reform the corporate income tax (CIT) structure to ensure the statutory tax rate for both export-oriented and non-export sectors is not lower than 15 percent, aligning with the global minimum tax commitment under the OECD/G20 Inclusive Framework while maintaining Bangladesh’s competitive advantage. He suggested performance-based or conditional incentives for listed companies and proposed globally practiced alternatives such as tax credits for IPO-related costs and temporary tax holidays for newly listed firms.
Ahmed recommended forming a dedicated oversight committee, including business community representatives, chartered accountants, and NBR officials, to review and resolve disputes related to disallowed business expenditures transparently and consistently. He also advocated for increasing corporate profits as a share of GDP and gradually reducing the effective corporate tax rate.
He urged the NBR to increase the corporate tax base and make tax submission status data publicly accessible. Ahmed proposed digitizing tax returns submission, consolidating VAT slabs, and removing problematic VAT exemptions to broaden the tax base and improve equity.