The government loses substantial amount of revenue due to tampering with state stamps every year, competent sources said.
Such leakage of revenue has been taking place as there is hardly anyone to oversee the collection of this duty.
Spot survey found miscalculation of stamp duty, its reuse and use of photocopy of treasury chalan as rampantly applied ways of evading the stamp duties.
Such freewheeling is taking place in the absence of specific authority for monitoring stamp-duty collection, the sources added.
According to schedule 1 of the Stamp Act 1899 there are 65 items from which government collects stamp duties. There is no specific collecting and monitoring authority under the outworn law for each of the item of stamp duty to check its evasion.
There is serious deficiency in collection of stamp duty in proper amount and in right time for lack of monitoring.
Official sources said a customs, excise and VAT commissionerate in Dhaka detected evidences of stamp-duty evasion by insurance companies, land developers and real-estate companies at the time of monitoring VAT payment in the sector.
Many insurance companies do not pay right amount of stamp duty, they said.
"We have found an insurance company having shown Tk 1.6 million as stamp duty in their accounts but deposited Tk 1.4 million in the treasury," said a VAT official said.
The spot checks found insurance companies evading 40 to 50 per cent of the stamp duties.
According to the 'Stamp Duty Payment Rules of Insurance Policy 2002,' the insurance companies have to maintain a register on such duty payments.
According to the rules, the companies have to send attested copies of the treasury chalans to the income tax commissioner or the deputy commissioner of taxes and insurance regulator by the 20th of a month.
Income tax office is empowered to verify whether a treasury chalan is genuine or not.
As per the rules, the income tax offices will have to send quarterly and annual reports to the Internal Resources Division (IRD) on its income under stamp-duty head.
However, the rules have not been followed by the income tax offices properly.
Although only a handful of insurance companies submitted their reports irregularly, the income tax office did not follow up on the matter.
On land development and real-estate companies, it has been found that many investors in flat and land are evading both stamp duty and VAT by showing lower prices.
The main conduit for evasion is the government-fixed prices of land and flat which are much lower than open market rates. People evade VAT and stamp duty through showing prices lower than the real, on a par with the government-set prices.
Officials of a VAT commissionerate have found a buyer purchase a flat of 3429.08-square-foot size at Tk 10.07 million as its price. And the buyer paid Tk 0.3 million at 3.0 per cent VAT through treasury chalan in the registration complex.
On the same flat, the buyers showed Tk 39.16 million as purchase price and paid Tk 1.1 million at a rate of 3.0 per cent in a circle office.
The price of the flat equals Tk 49.23 million while its registration price has been declared Tk 10.07 million. That means, the buyer had paid stamp duty on that price and evaded duty on the rest. Maximum real-estate companies do not pay VAT on actual price of flat. They submit the main copies of VAT and stamp duty payments to the land-registration office.
Talking to the FE, a senior Value Added Tax (VAT) official said some major items of the stamp duty are relevant with activities of the customs and VAT department.
"The customs and VAT wing supervises or monitors different activities under it on daily or monthly basis. The wing can supervise the collection of the non-NBR tax revenue from stamp duty," he said.
Currently, the VAT wing is collecting health development surcharge and environment surcharge at 1.0 per cent from industries as non-tax revenue.
Talking to the FE, officials of the Internal Resources Division (IRD) said the division used to compile the revenue-collection data on stamp duty. They are now going to digitize the stamp-duty-collection system. The collection of stamp duty posted only 7.5 per cent growth in fiscal year (FY) 2014-15 compared to that of the previous years.
Until March 2016, the government has collected Tk 20.54 billion in stamp duty. The government set a target of collecting Tk 36.04 billion as stamp duty in the FY 2015-16.
© 2024 - All Rights with The Financial Express
