Govt to split NBR into two divisions by Dec

The government is set to complete the split of the National Board of Revenue (NBR) into two separate divisions by December this year.

"We will implement the revised law by this time. We have to change the rules of business for implementation. We have already prepared a draft," Finance Adviser Salehuddin Ahmed told The Daily Star yesterday.

The disclosure comes after the interim government issued the amended ordinance on revenue policy and revenue management on September 2, saying the new law will be effective based on the date fixed by the government.

The government, under the much-talked-about law, which drew unprecedented protest among taxmen in May and June, plans to split the tax system into two: Revenue Policy Division and Revenue Management Division. The law also mandates dissolving the NBR, in an effort to improve the country's tax collection, which is one of the lowest in the world.

The ordinance has been framed to fulfill a condition of the International Monetary Fund (IMF) tied to a $5.5 billion loan given to Bangladesh, approved in January 2023.

The finance adviser said the Internal Resources Division (IRD) and the NBR will be dissolved, and the two new divisions will be formed under the finance ministry as per the law.

"We have already drafted the rules of business. Besides, we need to change a couple of laws for the implementation," Ahmed said, adding, "We also have to prepare an organogram for the new divisions."

The revised ordinance paved the way for revenue officials to head the top and senior positions of the planned Revenue Policy Division.

In the original ordinance issued on May 12, there was ambiguity about whether officials from the tax and customs cadres would be given priority for the position of secretary, which was one of the major areas of contention among the protesting NBR officials.

The revised law will enable officials with experience working in the macroeconomy, trade policy, and planning to head the Revenue Policy Division.

Ahmed said secretaries will be appointed for the two divisions and positions of the existing members of the NBR will have to be determined before the implementation of the law.

As per the law, the Revenue Policy Division will be responsible for formulating tax policies, conducting research, and handling international agreements, while the Revenue Management Division will focus on field-level revenue collection, implementation of tax laws, and human resource management.