Dhaka aims to raise tax-GDP ratio to 10.6% by FY25

21 Nov '22

2 min read

Pic: Shutterstock

Dhaka plans to improve the ratio of revenue to gross domestic product (GDP) to 10.6 per cent in the mid-term, i.e., by fiscal 2024-25. That tax-GDP ratio indicates total government revenue as a percentage of the GDP. The revenue-GDP ratio for the current fiscal (FY23) has been estimated at 9.7 per cent, rising to 10.4 per cent in FY24, according to an official document.

In preparing the fiscal policy, the government has been maintaining an expansionary fiscal stance by keeping the budget deficit at a moderate level, the document said.

The government has also undertaken several reforms to raise the revenue-GDP ratio, which is low compared to neighbouring countries. Due to the rebasing of the GDP to FY16, the ratio has dropped even further.

Bangladesh has the lowest tax-GDP ratio in South Asia.

The finance ministry document said of the 10.6 per cent of the revenue-GDP ratio in FY25, 9 per cent will come from National Board of Revenue (NBR), 0.5 per cent will be from non-NBR sources while 1.1 per cent will be from non-tax sources, according to Bangladeshi media reports.

In FY23, the government is projected to get 8.3 per cent from NBR, 0.4 per cent from non-NBR sources and 1 per cent from non-tax sources.

ALCHEMPro News Desk (DS)

More Textiles News - Bangladesh...