The BNP has formed the government after securing a majority in the recent National Parliament elections. However, even before assuming office, weaknesses in the country’s economy were evident. There has been a slowdown in trade and commerce, a decline in investment and instability in the banking sector. Unchecked high interest rates have further worsened the situation.
Confidence in the capital market remains low, while the law and order situation has not reached a satisfactory level. Employment has contracted, putting pressure on the government’s treasury.
According to sources at the National Board of Revenue (NBR), the revenue shortfall in the first seven months (July–January) of the 2025–26 fiscal year has exceeded Tk60,000 crore. NBR data show that the revenue collection target for this period was Tk2,83,751 crore. However, a shortfall of Tk60,113 crore was recorded across the three main revenue heads, with the largest deficit in income tax.
The shortfall in income tax stood at Tk28,925 crore. At the import stage, the deficit was Tk15,683 crore, while the VAT shortfall amounted to Tk15,506 crore. Analysts warn that this revenue scenario will pose challenges for the elected political government.
During the period under review, the income tax collection target was Tk1,03,980 crore, but only Tk75,055 crore was realised. Corporate taxpayers deposit various taxes, including advance income tax and withholding tax, throughout the year, while individual taxpayers also contribute to the state exchequer. However, shrinking income streams have led to a sharp decline in income tax receipts.
Business leaders were reluctant to expand trade and commerce during the tenure of the interim government, and investment remained subdued. Government projects were also largely stagnant, leading to a significant reduction in the import of industrial and project-related raw materials. As a result, the government collected only Tk62,814 crore in import duties against a target of Tk78,496 crore.
VAT is paid at every stage—from import and production to marketing. During the period, the NBR collected Tk85,769 crore against a target of Tk1,01,275 crore. High inflation and declining household incomes have reduced consumption, adversely affecting VAT collection.
Mostafa Azad Chowdhury Babu, President of the Bangladesh Cold Storage Association, said, “Revenue collection will increase if business turnover rises. Without higher incomes, how will tax revenue grow? Investment does not take place unless the law and order situation is normal. Future investment and business expansion will depend on the government’s decisions regarding tax policy, electricity and energy supply, and law and order. If conditions do not improve, why would entrepreneurs invest large sums?”
Data indicate that people’s incomes are not increasing. Official figures show that inflation stood at 8.58 per cent in January, having remained high in November and December last year. Statistics also show rising household expenditure on rent, education and healthcare. The central bank’s policy of maintaining high interest rates to curb inflation has yet to produce the desired results.
Bd-pratidin English/ ANI
