NBR to Initiate Door-to-Door Campaign to Enhance VAT Collection

The National Board of Revenue (NBR) has announced plans to initiate a door-to-door campaign to enhance Value Added Tax (VAT) collection, following concerns over “unsatisfactory” revenue inflows from this sector.  

According to NBR data, VAT collection up to October reached Tk 41,192 crore, falling short of the Tk 51,904 crore target, as reported by UNB. By November, the figure had increased to Tk 45,831 crore, but NBR Chairman Md Abdur Rahman Khan expressed dissatisfaction with the progress during a recent briefing.  

To address the shortfall, the Awami League government has set an ambitious VAT collection target of Tk 1,59,100 crore for the 2024-25 fiscal year. The NBR chairman has instructed field-level officials to demonstrate maximum sincerity and integrity in improving VAT collection, which remains the country's largest source of revenue.  

Chairman Khan also called on businesses with outstanding VAT payments or without VAT registration to promptly comply, stressing the importance of acting swiftly to avoid complications. “We are going to start a door-to-door campaign,” he announced, urging officials to prepare for the initiative.  

In a related effort, the NBR plans to deploy Electronic Fiscal Devices (EFDs) nationwide, including in major cities such as Dhaka and Chattogram, to curb VAT evasion. EFDs, an upgraded version of Electronic Cash Registers (ECRs), automatically transfer VAT payment data to the NBR’s central server, reducing opportunities for fraudulent activity.  

Introduced in the 2020-21 fiscal year, EFDs aim to monitor transactions and ensure accurate VAT collection from 25 types of businesses. The government is currently outsourcing their installation and maintenance to ensure the system's long-term effectiveness.  

Despite earlier efforts to mandate e-cash registers for 11 business types in 2008—including hotels, restaurants, jewellers, and beauty salons—the results fell short of expectations, with many businesses evading VAT through non-compliance and collusion with field officials.  

NBR officials believe expanding the use of EFDs to retail and wholesale businesses will significantly increase revenue by capturing accurate transaction data and minimizing evasion.