Economists in Bangladesh (yours truly included) have long been stressing the need for increasing tax revenues. You may know Bangladeshs tax-GDP ratio is one of the lowest in the world. I sometimes wonder whether this single-minded emphasis on raising public revenues is the right thing to do. Stories on how the government is failing to maintain and expand economic services galore these days. Bangladesh used to have pliable and hassle free roads; our railway system used to be the most safe and most fun mode of travel; our ports used to function seamlessly 24/7; we used to get uninterrupted piped water supply in Dhaka and Chittagong; our family planning program used to be considered a model for the rest of the world to emulate; our civil servants and diplomats used to perform at internationally comparable level of dexterity. I could go on. Dont they sound like folkltales these days? Yes the population has grown as has the economy. This has led to fast expansion in demand for public services. However, look around us, East Asia in particular. They have grown even faster, yet public service delivery has not only kept up, but also improved! No matter how much we implore the taxpayers to be more tax compliant, the moral strength to do so remains fragile if we cannot couple it with credible promises to improve the coverage and quality of service delivery. If taxpayers money continue to be used to bail out public banks without addressing the root causes of their bankruptcy; if the taxpayers money are wasted on projects that continue to accumulate expenditures without moving an inch forward on the ground; and if undeclared incomes continue to be protected through whitening facilities year after year, what motivation can the innocent taxpayers garner to pay taxes? Already they pay more than what the public exchequer receives!
Posted on: Fri, 11 Jul 2014 09:44:00 +0000
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