Muhammad Tareq ; Business Desk – In a series of major shifts ahead of the upcoming fiscal year, the National Revenue Board (NBR) has backed away from several major tax proposals initially planned for the FY2026-27 budget.

In a bid to protect public interest and avoid administrative complications, plans to impose a wealth tax, provide an opportunity to whiten black money, and levy Advance Income Tax (AIT) on motorcycles and battery-operated auto-rickshaws have all been shelved at the last minute.

Initially, the NBR aimed to generate an additional BDT 20,000 crore in revenue by introducing a wealth tax. However, high-level government authorities advised against implementing it at this stage.

Similarly, a first-ever plan to levy AIT on motorcycles and battery-run auto-rickshaws faced severe public criticism, forcing the government to step back.

Speaking on condition of anonymity, a senior NBR official stated that while a rational wealth tax framework aligned with global standards had been exhaustively reviewed, it ultimately did not receive the green light from the upper echelons of the government.

Proposed Wealth Tax Slab That Was Shelved

Under the primary draft, the tax was designed to be levied on the declared net wealth in tax returns due to the complexity of determining market values.

The scrapped progressive tax structure planned to keep net wealth up to BDT 4 crore completely tax-exempt, matching the existing surcharge limits. The proposed slabs were:

Relief for Bikers and Auto-Rickshaw Drivers

The initial proposal to impose a tax on motorcycles with engine capacities above 110cc sparked protests by ride-sharing drivers and bikers outside the NBR headquarters, alongside heavy social media criticism.

Considering the financial hardship of ordinary citizens, the government has entirely discarded the AIT proposal for these vehicles. However, staying compliant with higher-end models, a Taxpayer Identification Number (TIN) will remain mandatory for owners of motorcycles exceeding 165cc.

Furthermore, a proposed annual AIT plan for the rapidly expanding fleet of battery-run auto-rickshaws has also been revoked. The initial drafts suggested a yearly tax of BDT 5,000 for city corporations, BDT 2,000 for municipalities, and BDT 1,000 for union parishad areas.

No Special Facility to Whiten Black Money

Discussions were held regarding a conditional window to legitimize undisclosed income or “black money” during real estate transactions (plots, flats, or commercial spaces), provided both buyers and sellers declared the actual market values. This highly debated loophole has been dropped from the upcoming budget as well.

Experts Weigh In

Snehasish Barua, Director of SMAC Advisory Services, noted that while wealth taxes theoretically reduce inequality, their practical implementation introduces major structural hazards, drives up administrative costs, and risks fueling capital flight.

He emphasized that the focus should instead be placed on tracking hidden assets to curb tax evasion. Regarding motorcycles and electric rickshaws, he noted that a minimum tax framework on higher capacity units could have effectively widened the tax net.

Meanwhile, Dr. M. Masrur Reaz, Chairman of the Policy Exchange Bangladesh, observed that withholding the wealth tax for now is a practical decision that requires better long-term mapping.

He strongly praised the decision to exclude black money whitening schemes, stating that such provisions breed corruption rather than bringing significant revenue to the state.