Collection of Value Added Tax (VAT) from major corporate houses marked a significant decline in the first quarter (Q1) of the current fiscal year (FY), mainly due to fall in revenue from cigarette manufacturing companies and mobile phone service-providers, according to official sources.
The Large Taxpayers Unit (LTU) under the VAT wing missed its revenue collection target in the Q1 of FY2014-15.
The LTU received less than its expected level of revenue earnings in the form of VAT from these two large sectors during the period under review.
It collected Tk 58.10 billion revenue as VAT against its target for Tk 63.23 billion, during July-September period (Q1) of FY 2014-15.
Cigarette companies paid Tk 28.91 billion as VAT or consumption taxes against LTU's target of Tk 34.90 billion in Q1 of fiscal 2015.
The unit received Tk 8.81 billion taxes from the country's six cell phone operators against its target for Tk 11.31 billion. Collection from cell phone companies posted a negative growth in Q1 of fiscal 2015 compared to that of the corresponding period of the previous period, according to the latest official, compiled data.
The data show that the largest telecom operator, Grameenphone Limited paid, as VAT, Tk 110 million lower in Q1 of fiscal 2015 than what it did during the corresponding period of the previous fiscal.
Robi Axiata Limited paid Tk1.91 billion in the first quarter of the current fiscal against Tk 2.02 billion during the corresponding period of the previous one.
Banglalink paid Tk 1.57 billion in Q1 of the current fiscal as VAT against Tk 2.01 billion in the same quarter last fiscal.
The collection of VAT from Airtel in Q1 of this fiscal was Tk 190 million short of what it paid in the corresponding period of previous fiscal.
VAT collection from major cement companies also posted a negative growth -- by 14.03 per cent in Q1 of fiscal 2015.
Paper mills paid 6.17 per cent lower revenue in Q1 of the current fiscal than that of the corresponding period of the previous one.
The VAT collection from footwear fell by 1.76 per cent in Q1 this fiscal compared to the amount of the corresponding period of the previous one.
A senior Vat official of the unit said the VAT collection, on an overall basis, grew by 10.50 per cent in Q1of the current fiscal over that of the corresponding period of the previous one.
VAT from cigarette manufacturing sector is the largest source of government's revenue collection, notwithstanding strong criticism of the use of this health hazardous item by the anti-tobacco groups and health experts.
Mobile phone operators are in the second position in terms of VAT payments among the large VAT-payers under the LTU, followed by entities in gas sector, banks and cement companies.
Service sector also failed to contribute, in the form of VAT, to the public exchequer, up to the expected level of the taxmen in the first quarter of the current fiscal. This is reflected in the fall in the amount of payments of VAT by enterprises in the sector.
"Closure of Hotel Sheraton caused a VAT-related revenue loss of a considerable amount for the LTU", he said.
However, consumption of food and beverage was significantly high in the Q1 of the current fiscal due to the Eid ul Ajha and the Puja festivals, the sources said.
VAT collection grew by 25 per cent during the period under review over that of the corresponding period of the last fiscal. An aggregate amount of Tk 1.33 billion was collected as VAT as in Q1 of fiscal 2015.
Gas distribution and supplying companies paid Tk 7.37 billion as VAT in the first quarter of the current fiscal, posting a 20 per cent growth over that of the corresponding period of the previous one.
During the first quarter of the current fiscal, VAT collection from banks also exceeded the target by Tk 40 million, showing a 18 per cent growth over that of the corresponding period.
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