A visiting International Monetary Fund delegation is examining Bangladesh’s tax policies, institutional reforms and revenue performance as negotiations continue over a proposed $4.5 billion loan.
The 12-member delegation, led by George Khristner, deputy division head of the Capital Market Wing, is visiting Bangladesh to assess economic conditions and develop a strategy for the proposed financing program.
The negotiations follow Bangladesh’s previous $4.7 billion IMF loan, which was increased by $800 million to $5.5 billion during the interim government.
The financial assistance comes with conditions requiring reforms involving the central bank, banking sector, climate initiatives, power and energy industries and revenue administration.
One issue under examination is the government’s handling of tax exemptions.
Bangladesh had committed to ending what has been described as a culture of tax exemptions by July 1, 2027. However, the government stepped back from some proposed tax measures in its latest budget after accepting objections raised by business groups.
The visiting IMF delegation has requested details about the government’s decision and its progress toward completing the promised tax reforms.
The delegation is also examining delays in restructuring the country’s revenue administration. The government had planned to divide the revenue sector into two separate divisions, Revenue Policy and Revenue Management, by July 1.
That restructuring remains incomplete, and the National Board of Revenue is explaining the delay to IMF representatives.
The scrutiny follows a substantial revenue shortfall during the 2025-26 fiscal year. Bangladesh collected Tk 410,390 crore against a target of Tk 503,000 crore, achieving 81.6% of its goal.
Collection targets were missed across all three major revenue categories: income tax, value-added tax and import duties.
Finance minister Amir Khosru Mahmud Chowdhury said the government was working to assess companies’ market shares and expand the tax base through affordable, area-based rates.
“We are determining the market share of each company in every sector, that is number one. Secondly, we have moved to a flat rate… determining a flat rate based on areas for those who are not yet under the tax net, so they can pay tax within their means.”
The government’s ability to increase revenue, reduce tax exemptions and complete institutional reforms is expected to play a central role in the negotiations over the proposed IMF loan.