The National Board of Revenue is likely to implement a roadmap to phase out tax waivers enjoyed by different sectors from the new financial year beginning from July 1, officials said.
Besides, the revenue board is likely to keep the current income tax free limit for individual taxpayers unchanged at Tk 3,50,000, but increase the rate for the top tier of the individual income tax payers by 5 per cent to 30 per cent.
The NBR apprised finance minister Abu Hassan Mahmood Ali of the roadmap and others plans for the FY25 in a meeting on Sunday at its office in the capital.
State minister for finance Waseqa Ayesha Khan also attended the meeting.
The day鈥檚 meeting was a prelude to the NBR鈥檚 scheduled meeting with prime minister Sheikh Hasina on finalisation of the new tax measures on Tuesday, said the officials.
The officials also said that the roadmap to phase聽 out tax waivers to different sectors had been designed by the NBR with suggestions from the International Monetary Fund.
The government is borrowing $4.7 billion from the IMF to assist the county鈥檚 balance of payment, facing pressures due to shortages of the greenbacks pulling down forex reserves below $20 billion from $48 in August 2021.聽聽聽聽 .
A recently concluded IMF mission in the capital agreed to provide $1.1 billion as the third tranche of the loan programme soon but stressed the need for tangible measures in the FY25 national budget to augment tax revenues by 0.5 per cent of the Gross Domestic Product.聽
The IMF wanted the NBR to abolish tax waivers on clothing, footwear, liquefied petroleum gas and mobile phones.
It also suggested identifying eligible persons to qualify tax waivers in the information technology sector beyond June 2024.
In 2023, the NBR calculated that it had incurred revenue losses of 3.56 per cent of GDP, which is higher than lower-income countries in South Asia, Sub-Saharan Africa, East Asia and Pacific regions, by providing tax waivers to around 33 industrial sectors.
As suggested by the IMF, the NBR may impose 15 per cent VAT instead of truncated VAT on businesses with Tk 3 crore or more annual turnovers, while eliminating the VAT cap on entertainment and meals.
The revenue board may also abolish the depletion allowances given to the petroleum and mining extraction industry.聽
The country鈥檚 tax-to-GDP ratio has been regarded as one of the lowest in the world, forcing the government to depend on borrowing from both the local and foreign sources to meet the budget deficit.
The borrowing spree by the government over the past several years pushed up the overall debt liability and pressurised its repayment capacity.
Some Tk 1.13 lakh crore will be kept aside in the FY25 budget for clearing the interest payment for borrowing from the local and foreign sources, said the Finance Division officials.
The amount is more than double from Tk 55,664 crore paid in interest five years back in FY20, added the officials.
