NBR mulls uniform tax rate across sectors; RMG owners oppose

The National Board of Revenue (NBR) is contemplating the introduction of a uniform tax rate across all sectors in a move to eliminate existing disparities, NBR Chairman Abdur Rahman Khan announced at a pre-budget discussion in the capital today (12 April).

He said it should not be a mindset that business will happen only if tax exemptions are given. "You must consider taxes when planning a business. If there is taxable income, you pay tax; if not, you don't."

The event, titled "Pre-Budget Discussion 2025-26: Private Sector's Expectations," was organised by the Dhaka Chamber of Commerce and Industry (DCCI) in association with The Daily Samakal and Channel 24. DCCI President Taskin Ahmad moderated it.

NBR chairman's remarks drew opposition from business leaders in the garments sector and other sectors that enjoy the facility.

Former BGMEA director and Urmi Group Managing Director Asif Ashraf said the garment sector currently pays a 12% corporate tax, and this preferential rate was granted for a fixed period. "If the rate is changed midway, it will break the confidence of investors and businesses," he said.

He also reminded the government that policy consistency was emphasised as a key issue during the recently concluded investment summit.

Matiur Rahman, chairman of Uttara Motors Limited, said the government is now abruptly withdrawing the tax exemption, hindering industrialisation. 

"A large number of industries are on the verge of closure. If you create so many obstacles, industrialisation will not be possible," he said.

Currently, the corporate tax rate for private, non-listed companies in Bangladesh stands at 27.5%. However, garment exporters have long enjoyed a reduced rate. At present, factories in the garment sector pay a 12% tax, while certified green factories pay 10%.

In addition, sectors such as textiles are also benefiting from reduced tax rates, while sectors like IT are receiving full tax exemptions.

In order to comply with the International Monetary Fund's conditions, the government is phasing out the tax exemptions. 

Speakers at the discussion highlighted that irregularities in expenditure outweigh issues in revenue collection. 

Business representatives emphasised the need for political stability, a business-friendly environment, reduced customs-related harassment, and equal treatment and a level-playing field for all taxpayers and businesses.

Abdul Awal Mintoo, former president of the FBCCI, said, "There is more theft in expenditure than in revenue collection."

He warned of a looming crisis if banks continue to face difficulties in opening letters of credit (LCs). Mintoo called for a unified monetary policy for both the private sector and the government.

Criticising harassment by NBR officials, he said, "The harassment begins as soon as the tax returns are submitted. Many are hesitant to come under the tax net due to this fear."

Imran Karim, former president of the Bangladesh Independent Power Producers Association, pointed out the disparity between private power producers and imported electricity.

Other speakers included former commerce minister and BNP standing committee member Amir Khasru Mahmud Chowdhury, International Chamber of Commerce Bangladesh President Mahbubur Rahman, Samakal Editor Shahed Mohammad Ali, Dhaka Bank Managing Director Sheikh Mohammad Maroof and Chittagong Stock Exchange Chairman AKM Habibur Rahman.

Chairman admits obstacles to digitisation

Rizwan Rahman, former president of the DCCI, criticised revenue officials for stalling automation efforts in tax collection. "Automation is essential now. But unfortunately, the main obstacle comes from within the NBR and field-level officials, who fear losing opportunities for underhand dealings."

Acknowledging the issue, the NBR chairman said, "The obstacles to automation do indeed come from NBR officials — this cannot be denied."

Citing ongoing initiatives such as online tax return submissions, a green channel facility for trusted businesses, and the Bangladesh Single Window for online import-export documentation, he said, "We have no alternative but to move towards automation."

The NBR chairman also expressed a commitment to fostering a more business-friendly tax regime. "We may not be able to cut taxes significantly, but we will try to remove barriers to doing business in the upcoming budget," he said. 

The revenue board chief also suggested introducing provisions to allow the carry-forward of previously paid taxes.