VAT receipts expected to rise by nearly 20% this fiscal year: NBR chief
He noted that VAT receipts grew by 15% in the first five months of the fiscal year compared with the same period last year.
Value-Added Tax (VAT) collection is on track to grow by close to 20% by the end of the 2025-26 fiscal year, according to National Board of Revenue (NBR) Chairman Md Abdur Rahman Khan.
Speaking at an event marking National VAT Day at the revenue authority's headquarters in Agargaon today (10 December), he noted that VAT receipts grew by 15% in the first five months of the fiscal year compared with the same period last year.
"We expect collections to increase further over the coming months and reach around 20% by the end of the fiscal year," he said.
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Addressing the event, he urged officials not to take punitive action against traders for minor infractions.
"We must not oppress businesses. If we drive a business out for a small mistake, it would be like slaughtering the goose that lays the golden eggs," the NBR chief warned, adding that excessive penalties or harassment could harm revenue collection in the long term.
Abdur Rahman also noted that VAT is often misunderstood by businesses. "Businesses think they pay VAT, but they do not. They only collect VAT from consumers on behalf of the government," he told officials and traders. "They pay income tax, but VAT is not their tax. Import duties, too, ultimately fall on consumers."
The NBR chief further said VAT payment procedures would be simplified, and called on traders to ensure accurate VAT collection and deposition.
Noting that "no one willingly wants to pay tax", he added that various groups try to avoid taxes, but "this leads to problems in the future".
Abdur Rahman reiterated the need to reduce the country's dependence on import-stage taxes.
"Import tax cannot be the main source of revenue for any civilised country. The highest collection should come from income tax, then VAT, and the lowest should be from import duties," he noted.
At today's VAT Day event, Finance Adviser Salehuddin Ahmed, attending as the chief guest, called for modernisation, simplification and automation of the VAT system.
