Prime Minister’s Finance and Planning Adviser Rashed Al Mahmud Titumir on Wednesday said Bangladesh’s ability to meet rising revenue demands depends less on higher tax rates and more on rebuilding accountability, strengthening institutions and restoring public trust in the state.
Speaking as chief guest at a post-budget discussion jointly organised by the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI), Standard Chartered Bangladesh and the Policy Research Institute of Bangladesh, he said fiscal policy must move beyond conventional tax measures and place governance reform at the centre of revenue strategy.
He said Bangladesh is entering a phase where revenue mobilisation is increasingly tied to institutional credibility. Tax compliance improves, he argued, when citizens see transparency in public spending and when inefficiencies, leakages and rent-seeking are reduced.
“Accountability is not a governance slogan but a fiscal instrument,” he added.
Business leaders questioned the realism of the fiscal framework underpinning the budget, citing weak macroeconomic conditions and an ambitious revenue trajectory.
MCCI President Kamran T Rahman said the National Board of Revenue (NBR) would require roughly 40 per cent growth to achieve the next fiscal year’s target, defying the subdued investment and consumption.
Speakers said private investment remains weak, inflation pressures persist and economic momentum has yet to fully recover, making such revenue expansion difficult without deeper structural reform.
MCCI Tariff and Taxation Committee Chairman Hasan Mahmood raised concerns over several tax measures, including no relief in turnover tax and an increase in the minimum personal income tax rate from 5 per cent to 10 per cent, which participants said would increase pressure on compliant taxpayers.
Attention then shifted to financing risks, with participants warning that shortfalls in revenue and external inflows could widen the fiscal gap and increase reliance on domestic borrowing.
Economists cautioned that higher domestic borrowing could crowd out private credit, push up interest rates and intensify inflationary pressure, complicating macroeconomic management.
They also questioned whether the government can simultaneously achieve its 6.5 per cent growth target and 7.5 per cent inflation target under current conditions.
Business leaders argued that sustainable revenue growth depends on expanding economic activity rather than tightening tax enforcement alone, calling for improvements in energy security, infrastructure efficiency, regulatory predictability and the broader investment climate.
Titumir, in his concluding remarks, said Bangladesh’s next phase of development will depend on transparent, accountable institutions where economic reform is anchored in governance rather than taxation alone.
