Bangladesh is entering a decisive phase in its economic journey. As the country prepares for its post-LDC transition, the question of fiscal governance looms larger than ever. With the tax-to-GDP ratio stubbornly below 10 percent, the existing coercive and bureaucratic methods of tax collection are proving inadequate. What is required now is a fundamental shift in philosophy — one that treats taxpayers not as subjects of enforcement but as partners in nation-building. This transformation must rest on trust, transparency and accountability, rather than fear and compulsion.

The first step is to make taxation transparent. Too often, citizens feel their contributions vanish into inefficiency and administrative costs. In the United Kingdom, every taxpayer receives an annual tax summary showing exactly how their money is allocated across healthcare, education, defence and welfare. In Scandinavia, open ledgers of government spending have helped build some of the highest compliance rates in the world. Bangladesh can adopt a similar approach through a “My Tax, My Nation” digital statement, giving each taxpayer an infographic that shows how their money supports schools, hospitals, or infrastructure projects. When citizens see their contributions funding real initiatives — such as a local school upgrade or a new highway — compliance transforms from a legal burden into a matter of pride.

Fiscal democracy must also be strengthened. Budget planning in Bangladesh has traditionally been top-down, often overlooking local realities. Participatory budgeting, pioneered in Brazil and embraced in Taiwan, shows that citizens can play a direct role in shaping spending priorities. If taxpayers were allowed to allocate preferences during e-filing — choosing whether more resources should go to education, healthcare, or environmental protection — a portion of the development budget could reflect these aggregated choices. Even if only 10 to 15 percent of the ADP (Annual Development Programme) were tied to citizen preferences, it would create a powerful incentive for timely filing and foster a sense of ownership in national development. Taxpayers would no longer feel like passive victims of state extraction but active investors in their country’s future.

Recognition is another missing piece in Bangladesh’s fiscal culture. While a handful of “Top Taxpayers” are honoured annually, millions of middle-class contributors remain invisible. A tiered tax card system — Silver, Gold, and Platinum — could change that. These cards would not grant immunity but would offer privileges such as fast-track services at government offices, priority booking for state transport, discounted access to heritage sites, and preferential loan processing. Paying taxes would become a badge of honour, celebrated in society and business. Such recognition would create positive social pressure, making compliance a symbol of prestige rather than a matter of fear.

Efficiency must also be addressed. The National Board of Revenue struggles with capacity and expertise, particularly in dealing with large corporate entities. Public–private partnerships can inject agility into revenue collection. The United States IRS already uses private debt collectors, while many countries outsource customs valuation to specialised firms. Bangladesh could adopt a controlled model where private agencies manage high-revenue corporate clusters under strict oversight, working on a success-fee basis. This would bring in advanced analytics and efficiency while keeping legal authority firmly with the NBR. By leveraging private expertise in complex corporate supply chains, Bangladesh can reduce leakage, improve compliance and free up government resources for higher-priority tasks.

Finally, the culture of fear surrounding taxation must be dismantled. Many citizens avoid registration because they fear harassment, endless audits and extortion. Global examples show how trust can be built. Estonia’s five-minute pre-filled returns and the US Taxpayer Bill of Rights demonstrate how fairness and automation can transform tax culture. Bangladesh should move toward pre-filled e-returns linked to NID and banking data, AI-driven audits conducted anonymously, a formal Taxpayer Bill of Rights backed by an empowered Ombudsman, and a “no-penalty amends” window for informal earners. These measures would replace fear with partnership, broadening the tax base and welcoming new entrants into the formal economy without retroactive punishment.

Fiscal reform in Bangladesh must go beyond revenue targets. It is not enough to chase numbers; the system must be rebuilt to foster trust and voluntary compliance. By embracing transparency, democracy, prestige, agility, and empathy, the country can unlock a new wave of civic participation. When citizens see their contributions respected and directly linked to progress, taxation becomes not a burden but a shared pride. This is the foundation of a resilient, self-sustaining Bangladesh — one where fiscal governance is not about coercion but about partnership, and where the act of paying taxes is celebrated as a contribution to national progress.

Saifur Rahman is a fractional CFO and Managing Partner of Growth Space Advisory.

[The views expressed in this article are the author’s own and do not necessarily reflect the position of The Daily Bonik Barta or the organisation he works for]