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Tax authority fails to equip risk management arm in six years

Doulot Akter Mala | August 29, 2018 00:00:00

The risk management arm of the revenue board has not produced any visible results since its inception in 2012.

The lack of legal and logistic support for the Risk Management Central Unit is blamed for the situation.

This is the only unit within the National Board of Revenue (NBR) that has no orgnanogram, full time officer, logistic support, legal back-up or policy guidelines for carrying out its activities.

Board officials said the unit could not run properly due to the lack of supporting laws, rules and office space.

Officials said that the work plan of the risk management unit was not well-defined and it was not also included in the Customs Act-1969.

Still, they are hopeful about its functioning anytime soon.

"We've incorporated the relevant provision of risk management into the Finance Bill-2018. The unit might be able to work under legal back-up from the current fiscal year," said Mohammad Fakhrul Alam, first secretary of customs modernisation and project management wing of NBR.

The NBR is drafting a Statutory Regulatory Order (SRO) with the help of the World Bank (WB) to frame relevant rules for the unit, he said.

It has a plan to form a small risk management directorate to carry out its activity for combating duty evasion, he added.

The NBR may also procure software for the unit to conduct analysis and identify items prone to duty evasion, he added.

The government has formed the unit to minimise the risk of revenue loss through using technology, he said.

The risk management unit would enhance revenue assurance, assess trade risk, and target scarce resources towards high risk transactions.

According to the customs modernisation plan of the NBR, the unit was supposed to  start its work in September 2013.

The assessment of current risk management practices was also supposed to be made within September 2013- February 2014, while a presentation of the findings was due in March 2014.

The formulation of policy documents related to risk management was due in September 2014. Officials said none of the deadline was met by the unit.

On Sunday, the NBR reconstituted the unit by assigning two dedicated fulltime officials to work under the unit, Mr Alam said.

Within the next two years, the unit will prepare short, medium and long-term work plan to reduce risks in the collection of duties and taxes.

The unit would identify the risky traders, risky import-export consignments based on various criteria after analysing the recent trends, past records and other data.

Consumer goods, consignments loaded with various types of goods, goods having high duty, country, luxury goods, origin of import, starting port, compliance records of importers, customs and clearing agents and others would be scrutinised.

Risky goods and traders will be categorised as 'red' in the online system of customs. Those goods and consignments of traders will be subject to physical examination.

The unit will consistently update the list of red category goods and traders through including and excluding names based on the results of analysis.

Unit officials will use data received from various customs houses, land customs stations, informants, various global database and Asycuda World system.

Past record was not encouraging, however. On May 10, 2018, the NBR had reconstituted the central risk management technical unit.

It had remained ineffective since then due to the lack of logistic support, office space and fulltime officials.

The proper activation of the risk management unit will help Bangladesh align with the revised Kyoto Convention, the Framework of Standards to Secure and Facilitate Trade, the World Trade Organisation's Trade Facilitation Agreement and implement customs modernisation strategic action plan.


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