The authorities of the National Board of Revenue (NBR) are being scaled back. Moving forward, the NBR will focus exclusively on revenue collection, while a separate commission will oversee policy formulation and strategic decisions.
This proposal has been put forward by the NBR Reform Committee.
The committee argues that this change will protect taxpayers from harassment caused by biased decisions and improve revenue collection. Business leaders have welcomed the proposal, viewing it as a positive step, although economists are concerned about potential long-term complications.
The NBR currently provides the largest share of government expenditure by collecting VAT, taxes, and customs duties directly from individuals and businesses. At present, the NBR functions under the Internal Resources Division (IRD) and handles both revenue policy formulation and revenue collection. The Secretary of the IRD also serves as the Chairman of the NBR. However, the NBR Reform Committee has recommended that the NBR's role should be limited to revenue collection.
Dr. Mohammad Abdul Mazid, a former NBR Chairman and a member of the NBR Reform Committee, clarified that the NBR head will focus solely on operational tasks related to revenue collection. Responsibilities such as issuing Statutory Regulatory Orders (SROs) and drafting finance laws will be handled by other authorities.
Policy-making responsibilities for VAT, taxes, and customs duties will be transferred to a separate Revenue Policy Division. This division will be headed by an officer of Secretary rank. Additionally, a permanent advisory council consisting of 15 to 16 members will be established. This council will include representatives from the NBR, the Ministries of Finance, Commerce, and Industries, business organizations, and research institutions. The commission’s policy decisions must be approved by this advisory council before being implemented by the NBR.
Dr. Mazid emphasized the importance of the advisory council, noting that its collaborative structure would bridge gaps between stakeholders and ensure transparency in policy formulation.
Business leaders have long advocated for such a division of responsibilities. Taskin Ahmed, President of the Dhaka Chamber of Commerce and Industry (DCCI), described the proposal as a long-overdue reform and expressed optimism about its potential benefits.
While economists have acknowledged the merit of separating policymaking from revenue collection, they remain cautious about its implementation. Dr. Zahid Hossain, an economist and member of the White Paper Preparation Committee, highlighted concerns about the effectiveness of the new policy-making body. He warned that if the committee operates within the same bureaucratic framework as before, it may fail to bring about meaningful change.
In October of the previous year, the interim government established a five-member advisory committee to spearhead reforms in the NBR.
