Large revenue stuck up as ADR fails to click

Doulot Akter Mala | Published: February 13, 2015 00:00:00 | Updated: November 30, 2024 06:01:00

Alternative Dispute Resolution (ADR) is yet to prove an effective tool to realise large amount of stuck-up revenue with cases filed by businesses piled-up in court.
Response of taxpayers to resolution of disputes over Value Added Tax (VAT) has been found extremely poor compared to the other two wings - income tax and customs.
Both tax officials and businessmen have alleged absence of proper government initiatives to popularise the system.
A recent review report of the National Board of Revenue (NBR) has revealed poor scenario on resolution of court cases on VAT and customs under ADR.
The report showed an extremely low trend in resolving court cases of the VAT wing. The highest amount of stuck-up revenue is lying with the wing.
The VAT wing received some five applications from the businesses since 2012 while some 2,566 cases with Tk 135.34 billion revenue are now stuck up. Â
The report found the VAT wing of the NBR settling some three cases in the last three years under ADR.
Talking to the FE, a senior VAT official alleged some of the businesses want to keep pending the disputes involving a large amount of revenue.
He said the businesses have found it more profitable to keep the money in banks instead of paying the claimed taxes with penalty. Â
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) adviser Manzur Ahmed, however, rejected the allegation as he found many small cases also remaining pending for long.
"There are several proposals of the FBCCI on amending the ADR rules for VAT which did not see light of the day," he said.
He said in the last two budgets, the apex chamber had proposed to bring amendment to the ADR law to make it attractive for taxpayers.
"In the existing law, the concerned commissioner chooses facilitators for the businessmen to conduct ADR cases which are unjust," he said.
According to the ADR law, commissioners of the concerned customs or VAT offices will choose the facilitators from the 13-member panel for resolving tax-related disputes through the ADR process.
Also, facilitators are mostly from the tax cadre for whom it is difficult to be impartial on judgment, Mr Manzur said.
The chamber has proposed to make the rules easier so that taxpayers can choose their own facilitators, Mr Ahmed said.
In the ADR system, the customs wing also did not get the desired response of the taxpayers.
The wing has some17,470 pending cases with Tk 48.35 billion stuck-up duty. Of the cases, some 67 have been resolved through ADR realising Tk 33.5 million taxes.
Officials said the revenue board does not have its own lawyers to run the court cases causing difficulties over expediting resolution of the cases.
Among the three wings, the income tax wing received the highest response from the taxpayers on ADR.
It has resolved 305 tax-related disputes out of 2,711 reference cases involving Tk 74.13 billion taxes.
doulot_akter@yahoo.com