Automatic tax deduction from govt employees’ salaries soon: NBR chief

National Board of Revenue (NBR) Chairman Md Nojibur Rahman has said the income tax (IT) will be automatically deducted from the salaries of the government employees at source in future.

He gave the indication at a seminar titled “Tax deduction at source: Our responsibilities” on Wednesday.

Unlike in other countries, income tax is not deducted from the salaries of the government employees at the time of monthly disbursement in Bangladesh.

Taxable employees pay tax directly at the NBR and then at the end of the year file IT return.

It was informed at the seminar that even the 11th grade government employees as per their annual incomes have now come under the tax net. There are nearly 300,000 employees up to this grade.

NBR Member Abdur Razzak said at the seminar that the provision for tax deduction at source for the government employees was introduced in the current fiscal year.

There was also a provision for realising interest on the tax at the rate of 2 percent if it was not paid monthly.

“But even nine months after the introduction of the new system, no government employee is paying tax at source. Even the NBR official are not complying with the system.”

After this fact was revealed, the NBR chairman hinted at the automatic deduction.

“We are thinking of automatically deducting tax from the salaries of the employees as various bills are deducted,” he said.

This would be introduced after the offices of NBR and the comptroller and auditor general were digitised, he informed.

Nojibur Rahman, however, did not reveal when this digitisation process would be completed.

He also highlighted various steps that were taken to intensify the revenue collection.

In addition, he stressed on the importance of forming a forum comprising NBR officials and chief accounts officers of various ministries.

Rahman hoped that the tax collection will become more dynamic if the forum meets quarterly.