Sponsors of commercial banks have proposed making company registration and monitoring stricter to bring discipline in corporate bodies.
They also suggest recasting the revenue board to plug leaks.
The sponsors also feel that the Registrar of Joint Stock Companies and Firms (RJSC) should work in sync with the National Board of Revenue to monitor taxpaying status of those companies registered under them, by setting up an interface.
"We are empowering Bangladesh Securities and Exchange Commission (BSEC), Dhaka Stock Exchange, Chittagong Stock Exchange (CSE) including those controlling only 397 listed companies, but for empowering RJSC having around 0.3 million public and private limited companies has not been taken into consideration," says the package proposal submitted by the Bangladesh Association of Banks (BAB) to the NBR advisory committee.
BAB Chairman Abdul Hai Sarkar has sent the proposals following request from Dr Muhammad Abdul Mazid, member of the advisory committee on reform in the NBR, also former chairman of the NBR.
The government should assess whether RJSC is well-equipped to monitor those companies, it has said.
"NBR needs to coordinate and integrate with RJSC, banks, RAJUK, Bangladesh Road Transport Authority (BRTA), land registry offices under a common digital platform to check and verify all the information," it adds.
The BAB has also proposed making each and every rental payment, especially monthly house rent of individuals, cashless by ensuring bank transfer to check tax and VAT evasion.
Talking to the FE, Dr Abdul Mazid said an interim report has been submitted to the government for its consideration.
"We are scrutinizing the proposals and will submit a final report soon."
The BAB chairman, Mr Sarkar, said the reform proposals have been submitted by addressing the problems facing the banking sector.
He said the taxmen should ensure a taxpayer-friendly environment for the large taxpayers like banks who contribute major share of revenue collection.
Mr Sarker stresses reformation of the revenue administration and not imposing tax burden only on existing taxpayers rather than focusing on untapped sectors to identify new taxpayers.
In the proposal, the BAB has said the banks' tax should be calculated on net profit after provisioning, not on operating profit.
"In accounting sense, provision is an expense and should be tax -exempted," the proposal reads.
The BAB also has proposed encouraging inward remittances by waiving the source tax at 7.5 per cent as well as outward remittance in the form of making interest on foreign loans tax-free.
Currently, it enjoys exemption on few conditions on Offshore Banking unit.
The bankers have also sought upward adjustment of tax-free threshold for individual taxpayers, from Tk 3,50,000 to Tk 5,00,000, on account of high inflation and other economic challenges.
Furthermore, the association has proposed lowering the highest rate of taxes for individual taxpayers from 30 per cent to 25 per cent.
The bankers want participation of all stakeholders in discussion before making policy decisions as they are the real players in fiscal -and taxation matters.
"Representatives of the NBR should be serving as employees of the public," the association says in the presentation.
The BAB chairman also sought immediate action of the NBR to settle pending tax/vat cases-especially cases pending with the High Court.
On institutional framework and principle of governance of the revenue board, the BAB has proposed ensuring accountability of the revenue officials, review of their assets and liabilities, lifestyle and source-of-income monitoring and introduction of reward and recognition system for them.
The bankers' reform suggestions has an implicit reference to recent revelation of scams involving revenue personnel, including the fabulous wealth amassing by a high officials.
The association put emphasis on automation and use of digital platform to check and verify information in order to plug revenue leaks.
"All of the offices will input information against TIN number of any kind of asset acquisition and transfer on a common digital platform," it proposes.
The BAB also recommends engaging technical people to improve all MIS of the NBR and need to ensure automated integrated MIS system.
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