• Significant Surge Attributed to Online Tax System Implementation
• Land Development Tax Collection Reaches Tk 325 Crore in One Month

Staff Reporter, Dhaka : Land Minister Saifuzzaman Chowdhury has expressed hope that, starting next year, it will be possible to deposit approximately Tk 2000 crore as revenue in the government treasury through land development tax. This amount represents an increase of almost three times or more than 200 percent compared to the previous collection from land tax prior to the implementation of the digital land development tax system.

Land Minister Saifuzzaman Chowdhury made this statement as the chief guest during a policy dialogue focused on the ‘Scope and State of Property Taxation in Bangladesh.’ The event, organized by The Center for Policy Dialogue (CPD), a non-governmental policy research organization (think tank), took place at a hotel in Gulshan, the capital, on Wednesday.

It is worth noting that during the year 2019-20, approximately Tk 621 crore was collected in land development tax through a fully manual tax system. However, since the inauguration of the online land development tax system by the Honble Prime Minister Sheikh Hasina in 2021, approximately Tk 867 crore has been collected throughout the country during the rolling-out of the online LD tax system in the year 2021-22. This indicates that 30 percent of the total collection was collected online as LD Tax, and this online system is responsible for an increase of almost TK 250 crores.

The Land Minister also stated that almost 100 percent of the land development tax is currently being collected online nationwide, following the implementation of a fully cashless system since April 14, 2023. In just one month, Tk 325 crore has been collected.

The Land Minister announced that the draft land development tax law has already received policy approval from the cabinet as part of the efforts to modernize the land tax system. He further mentioned that the draft would soon be submitted to the Jatiya Sangsad for enactment. Taking into account the national economic plan, the draft law proposes to align the payment of land development tax with the current fiscal year (June-July) in the country.

In reference to the land rent waiver of up to 25 bighas initiated by the Father of the Nation, Bangabandhu Sheikh Mujibur Rahman, the first land reformer of independent Bengal, the minister highlighted that the land tax rate in our country is determined with consideration for the larger population. Consequently, Bangladesh stands among the countries with the lowest land tax rates.

The minister emphasized the necessity of raising capital gains tax and other direct taxes to bolster the tax-GDP (gross domestic product) ratio and drive economic development. The government is actively pursuing this goal. The minister expressed his view that Value Added Tax (VAT) has made a positive contribution to the country’s economy. Additionally, he asserted that the stability of Bangladesh’s economy, even amidst the global pandemic, recession, and conflicts in various regions, can be primarily attributed to the continuous governance in the country.

Centre for Policy Dialogue (CPD) Executive Director Dr. Fahmida Khatun moderated the dialogue event.

CPD Fellow Dr. Devapriyo Bhattachariya presented the keynote speech on a study titled “Scope and State of Property Taxation in Bangladesh”. The study has identified three principles for the proposed reform: equity, efficiency, and transparency. In this study, the property taxes of Bangladesh have been assessed through five dimensions: tax base, exemption, valuation, rate, and administration. The study recommends the following measures: curbing tax evasion, ensuring accurate valuations, gradually rationalizing tax rates, strengthening tax administration, implementing digitization and MIS processes, improving information dissemination, introducing Alternate Dispute Resolution, reforming the existing provisions of gift tax, bringing the Heba system under gift tax, and introducing property tax Inheritance Tax.

Member of Parliamentary Standing Committee on Ministry of Law, Justice and Parliamentary Affairs Barrister Shameem Haider Patwary, MP was present as the special guest at the event. Head of Cooperation of the Delegation of the European Union to Bangladesh Maurizio Cian present as Guest of Honor. Former Chairman of National Board of Revenue (NBR) Dr. Nasiruddin Ahmed, Executive Director of Policy Research Institute of Bangladesh (PRI) Dr. Ahsan Habib Mansur, and Partner of Snehasish Mahmud & Co. Snehasish Barua, FCA were present as Panellists.

Rather than introducing new tax categories, the panel of experts proposed boosting revenue by enhancing the efficiency of the current tax system. Their recommendations include simplifying the tax system to make it more comprehensible for the general public, integrating the land registration system with other land service providers under a single ministry, and establishing interoperability between the databases of various government service providers. They also emphasized the importance of raising citizen awareness regarding tax-related matters.

Senior officials of various non-governmental development organizations, civil society representatives and media personalities were also present on the occasion.