NBR for tax at source on savings tools as final settlement
Monday, 1 November 2010
Doulot Akter Mala
The National Board of Revenue (NBR) has proposed to consider tax at source on savings tools as final settlement after it found that higher tax incidence has discouraged the small savers from investing in the instruments, officials said Sunday.
The revenue board has found that investment in savings tools declined by Tk 5.80 billion in the first two months of the current fiscal compared to the last corresponding period after imposition of higher taxes in the 2010-11 budget.
The revenue board has taken the move recently in a bid to ease tax burden on small savers.
The National Board of Revenue has sent a proposal to the economic affairs adviser to the Prime Minister, Mashiur Rahman, to consider tax at source as final settlement for small savers.
Revenue officials said Prime Minister Sheikh Hasina pledged to discuss the issue. The economic affairs adviser also responded positively to the NBR proposal keeping in view the small savers' woes.
The small savers are facing unusual hassle as the new measure forced them to count higher taxes despite having no taxable income.
"Small savers have to pay tax at the time of cashing the savings certificates which are adjustable with the actual tax return. Under this rule, people who have income below taxable limit have to pay taxes," said a senior revenue board
official.
The revenue board almost every day is facing complaints from the small investors on the tax measure, he said.
"The revenue authorities also felt the sensitivity of the measure as it affects thousands of small investors," he said.
The government has withdrawn the tax-free ceiling of Tk 150,000 and imposed 10 per cent tax on income from savings certificates in the current fiscal. Only pensioners' and family savings certificates are exempted from taxes. Investors in the two instruments will have to pay income taxes on profit if it exceeds the tax-free limit of Tk 165,000 for individual taxpayers.
The National Board of Revenue (NBR) has proposed to consider tax at source on savings tools as final settlement after it found that higher tax incidence has discouraged the small savers from investing in the instruments, officials said Sunday.
The revenue board has found that investment in savings tools declined by Tk 5.80 billion in the first two months of the current fiscal compared to the last corresponding period after imposition of higher taxes in the 2010-11 budget.
The revenue board has taken the move recently in a bid to ease tax burden on small savers.
The National Board of Revenue has sent a proposal to the economic affairs adviser to the Prime Minister, Mashiur Rahman, to consider tax at source as final settlement for small savers.
Revenue officials said Prime Minister Sheikh Hasina pledged to discuss the issue. The economic affairs adviser also responded positively to the NBR proposal keeping in view the small savers' woes.
The small savers are facing unusual hassle as the new measure forced them to count higher taxes despite having no taxable income.
"Small savers have to pay tax at the time of cashing the savings certificates which are adjustable with the actual tax return. Under this rule, people who have income below taxable limit have to pay taxes," said a senior revenue board
official.
The revenue board almost every day is facing complaints from the small investors on the tax measure, he said.
"The revenue authorities also felt the sensitivity of the measure as it affects thousands of small investors," he said.
The government has withdrawn the tax-free ceiling of Tk 150,000 and imposed 10 per cent tax on income from savings certificates in the current fiscal. Only pensioners' and family savings certificates are exempted from taxes. Investors in the two instruments will have to pay income taxes on profit if it exceeds the tax-free limit of Tk 165,000 for individual taxpayers.