Revenue collection falls record Tk1 lakh cr short of revised FY25 target 

The National Board of Revenue lagged significantly in collecting revenue in the just-ended 2024-25 fiscal year.

In the year, the revenue collection saw a shortfall of Tk1 lakh crore, compared to the revised target to earn Tk4.63 lakh crore. At the beginning of FY25, the revenue target was set at Tk4.80 crore.

According to NBR officials, the deficit is attributed to the slowdown in economic activity in the context of the political changeover after the July uprising, reduction in the implementation of the Annual Development Programme (ADP), and protests and shutdown programmes of NBR officials at the end of the fiscal year.

Experts believe that setting excessive targets is one of the reasons for the large revenue gap. However, although the July uprising had a negative impact on revenue collection, it was not expected to be this low, they say.

NBR Chairman Abdur Rahman Khan yesterday told The Business Standard that they have not received the full figures yet. "We anticipate the revenue collection in the just-ended fiscal year to be Tk3.70 lakh crore.

"But, the collection was supposed to be Tk3.80 lakh crore," he added.

However, even if the collection is estimated at Tk3.70 lakh crore, the shortfall stands at approximately Tk1.10 lakh crore, compared to the initial target. Also, compared to the reduced target, the shortfall is approximately Tk94,000 crore.

The NBR chairman also said he is optimistic that despite a large gap between revenue collection and the target, growth is expected when compared to the previous fiscal year.

According to him, revenue growth in the just-ended FY25 will be a little over 2%.

An analysis of NBR statistics shows that in the last two decades, except for the Covid-marred year, there has never been such low growth. There was degrowth in the 2019-20 fiscal year against the backdrop of the pandemic.

"Revenue collection has stumbled in the last few days," the NBR boss said further, indicating the movement of the board's officials over the past few days. 

Talking to TBS, Towfiqul Islam Khan, senior research fellow of the Centre for Policy Dialogue (CPD), shared that a slight reduction was anticipated in revenue collection due to the economic slowdown in the context of the July uprising, but it was not expected to be this low. "Due to the slow implementation of the ADP and the agitation of officials at the end of the fiscal year, revenue collection did not match the expectation."

He said in the just-ended fiscal year, the GDP growth rate at current prices will be more than 10%. "The growth rate in revenue collection should similarly reflect this rate. But, the growth will be around 2%—meaning the revenue collection failed to meet expectations."

According to data from the planning ministry, only 49% of the ADP was implemented in the 11 months from July to May of FY25, which is the lowest in the last one and a half decade.

Experts say low revenue collection is the cause of inadequate ADP implementation, and low ADP leads to low revenue collection. When ADP is implemented, the government collects revenue in the form of source tax and VAT from there.

CPD Fellow Towfiqul Islam Khan further explained, "If the officials' demands had been discussed after the ordinance to abolish the NBR, there would not have been such a negative impact on revenue collection."

Due to low growth in revenue collection in the just-ended fiscal year, the NBR's revenue collection growth target for the new fiscal year has been increased to about 35%.

The government has set a revenue target of Tk4.99 lakh crore for FY26.