Prime Minister’s Adviser on Finance and Planning Rashed Al Mahmud Titumir said the absence of a visible connection between taxes and public services is one of the main reasons behind persistent tax evasion in Bangladesh.
“To encourage citizens to pay taxes, they must see how their money is being used,” Titumir said while speaking at a pre-budget discussion in Dhaka.
The discussion on digital accounting and revenue collection organised by the Institute of Chartered Accountants of Bangladesh (ICAB) and The Financial Express at the CA Bhaban in Karwan Bazar on Thursday.
The adviser announced that from the next fiscal year, income tax return acknowledgement receipts will include information on how government revenues are being spent in key sectors such as health and education.
“Why would citizens pay taxes if they do not receive services?” he asked.
The adviser said the initiative is aimed at strengthening transparency and rebuilding public trust in the tax system by showing taxpayers how their contributions support public expenditure.
He also stressed the need to improve accountability in public finance management and expand the country’s tax net through better citizen engagement and service delivery.
The Bangladesh Textile Mills Association (BTMA) president Showkat Aziz Russell questioned how the government spends taxpayers’ money and proposed forming a dedicated cell to ensure accountability in public expenditure.
Russell also alleged that the businesses are struggling due to a lack of policy support and a worsening business environment.
Referring to former finance minister Saifur Rahman, he said the late minister had provided extensive policy support for industrialisation but questioned whether the country was still following that path.
“I do not think we are,” Russell said, adding, “Businesses are collapsing, industries are shutting down, and the government is failing to ensure the environment and opportunities needed for doing business. Necessary policy reforms are not taking place.”
Addressing the government directly, the BTMA president said authorities become aggressive when businesses fail to pay taxes, but there is little accountability regarding how tax revenues are spent.
“If you do not receive taxes, you conduct raids and send people to jail. But what are you doing with my tax money?” he said.
“Just as you forcefully collect taxes from me, there should also be accountability regarding how those funds are spent. A separate monitoring cell should be formed for this purpose,” he added.
He also criticised what he described as wasteful government spending and warned that public expenditure was growing faster than revenue generation.
“You build bridges without roads and then tell us there is no money. The tendency of spending beyond income must stop,” he added.
Russell further urged the government to clearly disclose in the upcoming national budget how much allocation would go to industries, healthcare and education.
ICAB President NKA Mobin said Bangladesh’s economy continues to expand and the next national budget could reach nearly Tk 9 lakh crore, while the revenue collection target may be set at around Tk 6 lakh crore.
“To make revenue collection sustainable, the government must increase revenue from direct taxes,” he said, adding that VAT evasion and tax avoidance remain major barriers to improving revenue mobilisation.
Presenting the keynote paper, ICAB Council Member Sabbir Ahmed said the government needs to move away from the traditional paper-based accounting and reporting system to establish a more accountable financial framework.
He said introducing digital accounting systems would help ensure real-time reporting, strengthen financial oversight and reduce opportunities for tax evasion and fraud.
The American Chamber of Commerce in Bangladesh (AmCham) President Syed Ershad Ahmed said the three wings of the National Board of Revenue (NBR) are creating difficulties for businesses and warned that foreign investment would not increase unless the revenue administration is restructured.
He stressed the need for customs automation and said digital accounting and auditing systems could reduce corruption, improve Bangladesh’s image among foreign investors and enhance transparency.
“Foreign investors often view Bangladesh as a corrupt country,” he said, adding, “While corruption may not be eliminated entirely, digital systems can bring it down to a tolerable level.”
