CPD survey finds over 80% of businesses consider tax rates unfair

More than two-thirds of businesses highlighted major concerns over the lack of accountability among tax officials, pervasive corruption, and the absence of a fully digital tax submission system, according to a new CPD study.

For instance, 79 percent of surveyed firms pointed to weak accountability, while 72 percent blamed corruption within the tax administration. The findings were revealed today at a dialogue on corporate tax and VAT reforms held at Lakeshore Hotel in Dhaka.

The survey—conducted this year by the Centre for Policy Dialogue (CPD) in collaboration with Christian Aid (CA)—covered 123 companies in Dhaka and Chattogram. It found that 65 percent of businesses remain entangled in recurring disputes with tax officials over claims.

Business leaders interviewed for the study alleged that taxes are often imposed arbitrarily, without adequate justification or prior communication, creating a hidden burden heavier than the tax amount itself. Many argued this practice renders the overall tax system unfair.

In a separate survey, businesses also flagged multiple VAT rates as a significant obstacle. About 73.5 percent of respondents described the complexity of VAT laws as a critical barrier.

Other reported challenges include unclear VAT rules and guidelines, lack of cooperation from tax officials, inadequate training and awareness, difficulties in classifying goods and services, and high compliance costs.

The VAT-focused survey—structured after the World Bank Enterprise Survey—was conducted among 389 firms from Dhaka city and surrounding districts.