Economists and policy experts urged the next government to adopt realistic revenue planning and undertake comprehensive tax reforms, warning that arbitrary targets and weak planning could further strain Bangladesh’s fiscal management.
They made the remarks at a seminar titled “Revenue Challenges and Prospects for the New Government,” organised by Voice for Reform in association with the Bangladesh Research Analysis and Information Network (BRAIN) in the capital on Wednesday.
Prof Rashed Al Mahmud Titumir of Dhaka University said one of the major weaknesses of politicians was their tendency to announce ambitious plans without clear strategies or roadmaps.
He said economic inequality remained the country’s core challenge and that policies, strategies and fiscal roadmaps must be designed with that reality in mind.
He also pointed to the lack of expenditure discipline, saying arbitrary spending decisions imposed from the top must be stopped.
“Budgetary discipline is essential to prevent waste. Tax compliance in Bangladesh will not improve unless transparency is ensured in how money collected from taxpayers is spent,” he said.
Emphasising employment generation and social security, Prof Titumir said higher income levels would naturally lead to increased revenue collection if supported by specific and well-planned strategies.
He stressed the need for a comprehensive system linking investment, production, employment, consumption and a fair taxation framework.
“If Bangladesh is to become a trillion-dollar economy by 2034, economic growth must be effectively translated into revenue,” he added.
Shafiqur Rahman, executive director of BRAIN, said revenue targeting and planning in Bangladesh were often poorly designed, resulting in a haphazard approach to revenue collection.
He noted that political intervention frequently remained ineffective, enabling bureaucratic capture and the setting of unrealistic revenue targets without proper groundwork.
“Revenue, expenditure and growth must be calculated carefully and backed by detailed planning,” he said, adding that the country must move away from arbitrary figures towards well-thought-out, implementable plans.
He criticised what he described as unrealistic political promises, such as raising the tax-to-GDP ratio to 8 or 9 per cent within a single year.
“When the ratio currently stands at around 7 per cent, such a sharp increase in one year is not realistic,” he said.
Calling for realistic and time-bound planning, he urged the next government to clearly outline how targets would be achieved and over what timeframe.
“Simply saying revenue will increase by Tk 2 lakh crore in a year does not ensure implementation,” he added.
Rahman also stressed the need to increase reliance on direct taxes while reducing dependence on indirect taxes, advocating creative solutions and a gradual transition to a cashless system.
On National Board of Revenue (NBR) reforms, he said restructuring alone was not enough; improving institutional efficiency and capacity was more important.
M Mashrur Reaz, chairman of Policy Exchange Bangladesh, said the country has historically struggled to meet tax targets because it rarely uses systematic, analysis-based tools and data. “Targets are often set without considering economic prospects, tax sources, drivers or the private sector,” he said.
Speaking on external debt, he said it had reached around $113 billion, while debt servicing costs—particularly interest payments—had risen sharply in recent fiscal years.
He added that total debt, including government guarantees for state-owned enterprises and statutory bodies, now exceeded 16 per cent of GDP, increasingly emerging as contingent liabilities.
He also pointed out weaknesses in public investment management, saying project selection is frequently influenced by political considerations rather than economic necessity, feasibility or value for money.
“We must view Bangladesh’s fiscal and revenue management from a broader macroeconomic perspective, not just through the lens of revenue collection,” he said, adding that fiscal stability depends equally on how revenue is mobilised and how public spending is planned and executed.
He identified weak tax administration as one of the most fundamental constraints, saying it has fostered a culture of harassment that discourages voluntary compliance among individuals and businesses.
Instead of expanding the tax base, revenue efforts often focus on extracting more from existing taxpayers, he added, noting that income tax return submissions remain alarmingly low despite around 12 million TIN holders.
Although automation is widely recognised as essential for improving revenue mobilisation and curbing corruption, its implementation in Bangladesh has been weak and inconsistent, Reaz said.
He urged the next government to pursue institutional reform beyond creating new entities, focusing instead on strengthening existing systems, enhancing human resource capacity and ensuring accountability.
Economist Jyoti Rahman presented the keynote paper at the seminar.
