Defaulters risk tax waiver

A new 'tax-benefit policy' now in the offing would deny revenue defaulters the state facility of tax waiver, officials said.
They said the National Board of Revenue (NBR) has made the move to frame the policy to filter the tax-benefit recipients. Only "revenue-friendly" taxpayers would get through the screening.
Corporate or individual taxpayers having arrears in income tax, value-added tax or import taxes may not be entitled to enjoy the tax-benefits after the making of the policy.
The NBR in a recent board meeting directed its three policy wings - income tax, VAT and customs - to frame a draft of the policy.
To begin with, the sources said, the government's revenue board has already started curtailing the tax benefit for some of the organisations after having found large amounts of revenue arrears tucked under their accounts for years.
Recently, the NBR rejected several tax-exemption pleas of the state-run Bangladesh Petroleum Corporation (BPC).
"We have Tk 20.18 billion worth of arrears in VAT with the state-owned entity. Both the NBR and the BPC came to consensus that there is no dispute over payment of the VAT arrears," said one official.
The NBR has decided to curtail the tax benefit for the corporation until settlement of the payment, he added.
In a recent meeting, some of the revenue officials raised a proposal that the corporation release products from customs ports under bank guarantee which could be cashed under VAT rule 56 to collect the unpaid revenue.
The NBR has ruled out a VAT-exemption proposal on a contract between a joint-venture firm, Excelerate Energy Bangladesh Limited, and Petrobangla.
In a letter to the energy secretary, the NBR declined to offer the facility as BPC owes Tk 20.18 billion and Petrobangla Tk 223.58 billion to the exchequer.
"Exemption is a distortion of VAT system. The NBR has adopted a policy not to offer any type of tax benefit to any organization that owes income tax, VAT and customs duty to the government," the NBR letter said.
Revenue officials said similar policy will be followed for both private and state-owned entities (SoEs) on tax benefit.
Non-compliant taxpayers will not be entitled to enjoy the tax benefit in the near future, they added.
Official sources said a big chunk of revenue remained stuck with the SoEs but the NBR cannot go for stern action against them as utility services are related with the organisations.
SoEs owe an aggregate sum of Tk 152 billion in VAT to the large taxpayers unit (LTU) only. Of them, power, energy and mineral resources ministry holds the highest amount of blocked VAT worth Tk 138.81 billion.
Once the tax-benefit policy framed, realisation process of the long-pending arrears will be expedited, the officials hope.
doulot_akter@yahoo.com