The National Board of Revenue (NBR) is going to mandate Business Identification Number (BIN) against the value-added tax (VAT) applicable current accounts to enhance direct tax collection, according to officials.
The tax authority is now assessing the potential impact of the move and after finalising the assessment, it may be proposed in the next budget, they added.
The officials also think the move could bring a significant portion of informal businesses into the VAT system.
VAT is already the largest source of tax revenue for the NBR, and pressure has been mounting on the government to raise collections amid widening fiscal needs.
According to Bangladesh Bank data, more than 93.49 lakh current accounts are active across the country.
If even half of these account holders obtain VAT registration, the total number of BIN holders could exceed 40 lakh, significantly increasing VAT receipts, the officials said.
Bangladesh currently has 6.44 lakh registered entities, of which around 3.90 lakh file monthly VAT returns.
Md Azizur Rahman, member (VAT Policy) of the NBR, told TIMES that it will take time to implement the move as several issues, like the legal aspects, need to be addressed.
“We are currently conducting a sector-wise survey to identify VAT-eligible firms. Once the survey is completed, we expect a significant number of businesses to come under the VAT net,” he added.
The planned measure comes as Bangladesh accelerates digital reforms under the Strengthening Institutions for Transparency and Accountability (SITA) project, designed to boost revenue mobilisation and enhance transparency.
Once the project is completed, the NBR expects to move toward end-to-end automation, improving oversight of business transactions.
However, VAT law expert Bindu Saha said the move would increase registrations but could also create complications.
For example, many rice and paddy traders, as well as livestock farmers, maintain current accounts and even access large bank loans but remain exempt from VAT under the First Schedule.
“There must be a mechanism to separate such businesses,” he said, adding that individuals also open current accounts for personal use.
“How will the NBR compel them to obtain VAT registration?” Saha questioned.
NBR officials also acknowledged that a portion of current account holders deal in VAT-exempt goods or services.
Following this, the NBR would likely sign a data-sharing agreement with Bangladesh Bank to implement a digital verification process, they said.
It also needs to amend the VAT law, which currently sets turnover requirements for BIN registration.
Traders with annual turnover between Tk30 lakh and Tk50 lakh pay a 4 percent turnover VAT, while those above Tk50 lakh must obtain a BIN and pay VAT accordingly.
Bangladesh has long relied on indirect taxes, particularly VAT, to offset weak income tax collection.
Successive administrations have pledged to lift the tax-to-GDP ratio, but progress has lagged due to administrative shortcomings and the predominance of unregistered enterprises.
The NBR has expanded electronic return filing, rolled out electronic fiscal devices and increased enforcement drives in recent years.
Making BIN registration mandatory against current accounts would be one of its most sweeping reforms yet and could force informal operators to formalise their businesses.
The proposal is still under review and will require consultations with Bangladesh Bank and businesses before a final decision is made, officials said.
