Body to realise Tk 316b VAT arrears from Petrobangla

The government has formed a high-powered committee to realise outstanding Value Added Tax (VAT) and Supplementary Duty (SD) worth over Tk 316 billion from state-owned Petrobangla, officials said.
With the realisation of VAT and SD, the tax authority wants to offset its revenue shortfall of this fiscal year ending on June 30 next, they added.
The officials said the committee will put forward recommendations to the finance minister within a month after scrutinising outstanding VAT and SD with the revenue authority and price gap in gas sold by Petrobangla.     
The committee has been formed to hammer out a solution to the issue of outstanding VAT and SD Petrobangla owes to the National Board of Revenue (NBR), said a high official of the finance division.
The price gap has been created in absence of gas price adjustment with the actual procurement rates, officials said.
By official count, the state-run corporation owes about Tk 316.71 billion to the NBR in VAT and SD arrears during the period between the fiscal year 2009-10 and January 2017.
A high official of NBR said, "During the last one year, the tax authority has done their level best to realise arrears from Petrobangla."
"We expect to realise outstanding dues within the current fiscal year ending on June 30 next," he said.  
The state-owned gas companies collected value added tax (VAT) and supplementary duty (SD) worth Tk 132.78 billion from their clients between the fiscal year 2009-10 and January 2017, but they did not deposit the money with the public exchequer, according to NBR.
About Tk 90.80 billion got added up as accumulated interest on the VAT and SD for non-payment in right time as per Section 37(3) of the VAT Law 1991. From July 2009 to January 2017, the state-run gas distribution companies under Petrobangla had collected taxes/duty from customers, but had not paid it to the national exchequer, a source said.
Petrobangla has recently sought Tk 45 billion as subsidy from the government to make payment of taxes in the form of different names to the National Board of Revenue (NBR).
The state-owned company requires over Tk 60 billion for payment of value added tax (VAT) and supplementary duty (SD) to the revenue board annually.
Currently, the agency has a surplus fund. It has still a surplus of Tk 3.20 billion every month due to a hike in the price of gas, produced by international oil companies (IOCs), since March 2017. As a result, surplus fund is likely to stand at over Tk 38 billion within a year.
Some Tk 5.0 billion will be needed to pay VAT and SD to the revenue board every month. Petrobangla will be able to pay due VAT and SD from the current month of April if the government gives allocation.
The gross revenue of Petrobangla in the FY 2014-15 from sales of gas, gas-derived liquids, coal and granite stood at Tk 280.759 billion. After paying SD and VAT, net income was Tk 253 billion, according to its annual report.
Gross expenses, comprising Tk 27.61 billion in SD and VAT along with Tk 219 billion in cost of sales, amounted to Tk 246 billion.
After paying income tax, net profit stood at Tk 32.71 billion. And on payment of dividend of Tk 8.91 million, net profit stood at Tk 31.82 billion, the report mentioned.
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