The travel agents are under watch of the tax intelligence after the NBR wing found irregularities in showing incomes in their corporate-tax files.
Authorities concerned guess that such alleged cooking of books could have led to tax dodging to the tune of millions of taka.
The Central Intelligence Cell (CIC) under the National Board of Revenue (NBR) has found such mismatch in 27 tax files of the travel agencies.
After detection of the cases of tax evasion, the CIC has frozen some of the bank accounts of the travel-agency companies. Of the companies, some have paid the demanded taxes to the tax authority to open their bank accounts.
A senior tax official said some 10 top 12 bank accounts still remained frozen due to non-payment of taxes as per claim of the NBR.
"The CIC has found a huge volume of undisclosed income hidden by the travel-agency companies. The companies did not show the income that they earn from commission or as incentives," he said.
He informed that the taxmen claimed some Tk 500 million in taxes from the travel agents against the undisclosed income.
The CIC has served notices to 27 travel-agency owners following the detection of concealment of incomes they earned from airlines, GDS (global distribution system) incentive bonus and other benefits.
The CIC has instructed the travel agents to pay the taxes with penalty against the incomes.
Over the issue, the Association of Travel Agents Bangladesh (ATAB) recently met Finance Minister AMA Muhith to resolve the complexities.
According to the association members, it is unintentional and mistake of their tax adviser.
In a letter, the association also urged the NBR chairman to resolve the matter and sought apology for not showing the incomes that they had considered incentive bonus being productive agents of promotional airlines and GDS incentives.
"GDS companies, Amadues, Galileo, Abacus, pay an insignificant amount to the travel agents which the companies spend on maintenance purpose or purchase of computer, laptop, printers etc," the letter reads.
The travel agents have to spend on sales promotion and airlines companies also deduct different fees from bank guarantees of the travel companies, it said.
The travel agents have to bear the cost which they cannot collect from sub-agents or passengers, it added.
In their income-tax returns, the travel agents did not show the interest payments and service charges against their bank loans.
The travel agencies urged the NBR to waive the penalty on the undisclosed money so that they can pay the claimed taxes.
In the letter, the travel agents also requested the NBR chief to consider 60 percent expenditure on their income, bank interest and bank charges at the time of tax assessment.
They also urged the tax authority to conduct assessment of their tax files for the last four consecutive years instead of six years.
Talking to the FE, ATAB president S.N. Manzur Murshed (Mahbub) said the travel agents promote special carriers by offering a lucrative package through which they earn a insignificant 1.0 or 2.0 per cent profit.
"We used to share commissions and incentives between passengers and sub-agents to expand businesses on the competitive market.
"Even, some travel agents sacrifice their entire commission or incentives on sales of tickets to stay competitive," he said.
The NBR claimed taxes at a rate of 37.5 per cent for private companies while 25 per cent of listed ones. With the claim, the tax authority added penal taxes. As a whole, travel agents have to pay nearly 50 percent taxes on their previous income, he added.
"It is difficult to pay the claimed taxes. Some travel agents do not even gain one-third of the profit due to the promotional offers for airlines," he said, explaining their situation.
The ATAB president has also demanded either withdrawal of 3.0 percent tax at source on their commission or considering the tax rate as finally-paid tax.
In the budget for current fiscal year, the NBR levied the new tax at source on the income of travel agents. The paid tax could be adjusted with the actual payable tax at the year-end.
According to ATAB, there are some 3,000 travel agents across the country. In the NBR statistics, however, only 75 of them have tax files and submit tax returns regularly.
The ATAB president sought cooperation of the government so the travel-agency businesses could survive.
He mentioned that last year the government collected Tk 3.30 billion in tax revenue from the sector.
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