Businesses were found to be in an aggressive mood at an inter-active discourse on value added tax (VAT) payment with high officials of the National board of Revenue (NBR) early this week.
"We are willing to pay VAT, not bribe", said a business leader, alleging that many VAT officials were creating roadblock to smooth operations of their businesses.
Some other businesspeople present at an 'NBR- FBCCI dialogue' vented their anger over, what they claimed, excesses done by a section of field-level tax officials.
But the top NBR officials, including NBR chairman Nojibur Rahman, present at the function, kept themselves cool and tried to ease the tension created over the issue of VAT payments.
"This time I find a lesser number of complaints (from the businesses) compared to those raised during the previous meeting held on November 09 last", the NBR chairman said, expressing his satisfaction. He also promised to bring the dialogues that are regularly held between the NBR people and the businesses under an organisational framework.
"There is a need for trust building between tax officials and businesses", said President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Abdul Matlub Ahmed, complementing the bid of the NBR chairman.
The allegations that businesses evade payments of due amounts of taxes and duties and taxmen squeeze out bribe from businesses in this part of the world are more or less 'ancient'.
The popular perception is that both unscrupulous sections of businesspeople and tax officials are at fault. They believe that the two have developed a nexus to deprive the government of its due tax revenue.
If evasion of VAT or any other tax or taking of bribe is an old practice, then why are the businesses so much agitated?
The reason, it seems, is that the tax officials are now under tremendous pressure to boost revenue earning to help meet the tax revenue target set for the current financial year.
The target, according to experts, is quite an ambitious and difficult one. The shortfall in tax revenue collection during the first quarter of the fiscal has already created serious worries among the policy-makers. And as the head of NBR, Mr. Nojibur Rahman must be more worried than anyone else.
"According to my estimation, the tax authority will have to collect Tk 4.83 billion revenue every day and Tk.200 million every hour to achieve the revenue target", he said, pointing to the tough challenge facing the NBR.
Naturally, the traditional way of doing the job by the taxmen would not help achieve the target or go very near to it. In fact, the situation has compelled the NBR high-ups to gear up the field-level tax officials, who also coming under intense pressure, are now making frequent visits to the business establishment, demanding documents and summoning the business operators. The main objective behind this 'hyperactivity' is to raise the volume of VAT, the largest source of tax revenue for the government.
However, when the higher authorities ask the officials down the line to ensure greater compliance with tax payments, the latter taking undue advantage of the situation try to squeeze out some pecuniary benefits for themselves in exchange for certain 'relaxations'.
Such unholy practices are carried out just not by tax officials. This is true for others also. For instance, when law enforcers are asked to be tough on 'wrongdoers', political or otherwise, a section of police officials are found engaged in, what is popularly known as, business over indiscriminate arrests.
It does appear that allegations such as tax evasion and bribery over tax collection would go on, until efficient procedures of collecting all forms of taxes and duties are put in place. Some people tend to claim that automation alone would do the trick. But that is highly unlikely. Unless the men involved in tax administration become relatively clean and efficient, mere digitisation would not deliver the desired results.
The same is true also in the case of businesses or other individual taxpayers. Businesses need to be honest in preserving documents concerning their business transactions. This would relieve them of 'harassments' and 'hassles' they allegedly face from the taxmen.
In fact, problems surface when attempts are made to hide facts. And the detection of such hidden information strengthens the hands of taxmen. If the taxmen have any ulterior motive, they would naturally place proposals for a compromise in exchange for bribe. Any disagreement would only invite troubles.
So, 'trust building' between the businesses and tax officials, as desired by the incumbent FBCCI chief, would not be that easy. In addition to automation of the tax administration, this would necessitate shunning of 'greed' factor by both businesses and taxmen.
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