Govt out to devise means for avoiding tax exemption

Doulot Akter Mala | Published: May 08, 2016 00:00:00 | Updated: February 01, 2018 00:00:00

The government is weighing the possibility of paying from its own coffer the duties and taxes of public-private partnership and joint-venture projects and considering the same as part of its equity in those projects.
Officials said the move came following a note of Finance Minister AMA Muhith in order to narrow the scope of tax exemption in development projects as a measure for increasing country's tax-GDP ratio.
With the instructions, the National Board of Revenue (NBR) is framing policies for its three wings---income tax, customs and Value Added Tax (VAT)-to be laid down in the budget for fiscal year (FY) 2016-17.
To discuss the issues of tax-exemption and government's share in PPP projects, a high-level meeting will be held Tuesday at the National Economic Council auditorium on the planning ministry premises in Dhaka.Â Â
Finance Minister AMA Muhith is expected to chair the meeting while secretaries of all the relevant ministries and departments will attend it.
Officials said the finance minister remained rigid on his stance not to provide tax holiday to anyone for promoting tax-payment culture.
In January last, he declined to accept a tax-exemption proposal for investors in PPP projects.
In a note, he wrote all organisations will have to prepare their project proposals calculating the payable taxes to government.
"The government will take the responsibility of tax payment and that will be considered government share," the note reads about the proposed swap.
He, however, said approval from the prime minister would be needed for doing so.
Following instructions of the finance minister, the revenue board is preparing a working paper for a review of its policy to come out from the culture of tax exemption.
A five-member committee headed by the NBR member (customs policy) is now working on the modality of the paradigm change in joint undertaking of development projects.
Existing waiver trends, government's revenue- collection strategy, reform programmes of the NBR, tax-GDP ratio and other exemption-related issues will be focused in the paper.
Â Â Â doulot_akter@yahoo.com