The revenue authority has decided to recognise compliant businesses with VAT Honour Cards in an effort to encourage regular payments of indirect taxes to the state coffer.
Initially, 35,000 businesses that submitted all the 12 monthly returns in 2016-17 will be honoured with the card, according to the National Board of Revenue (NBR).
“The role of 'VAT trustees' is important for collection of indirect tax. That's why we have decided to recognise them,” NBR Chairman Md Nojibur Rahman said at a press meet at the NBR headquarters yesterday.
Also, the revenue collector will recognise the highest VAT payers for fiscal 2015-16 at national and district levels.
At the national level, nine firms will be awarded with crest and certificates for giving highest amount of VAT in manufacturing, trade and services while 140 will be honoured at the district level.
The cards will be given based on a policy framed by the NBR in 2005.
A firm has to pay 10 percent higher VAT than the previous year to be eligible to be one of the top VAT paying firms, according to the policy.
But businesses with tax related cases in courts, arrear tax and default loan will not be eligible for the honour.
That is why sometimes big companies fail to get the honour despite depositing high amount of VAT, officials said.
The revenue authority will award the winning VAT payers at a programme during the VAT Week to be observed from December 10 to December 15.
Value-added tax, also known as consumption tax, is the biggest source of revenue followed by income tax and import duty in Bangladesh.
Around 36 percent of the Tk 185,003 crore revenue collected in 2016-17 was indirect tax.
The NBR has set the target at Tk 91,254 crore for the current fiscal year.
“We have taken various programmes to aware people about VAT payments for the development of the country,” Rahman said, adding that awareness on VAT has risen in recent times thanks to countrywide campaigns. The number of return filers has increased to 60,000 from 32,000 since the launch of the online VAT registration system in the beginning of this year, according to the NBR.
“The beginning might be small, but we are thinking big,” he said, adding that a policy is being framed in this regard.
Md Rezaul Hasan, NBR member for customs and VAT administration, said the honour cards will be given from field offices during the VAT Day and VAT week in phases. “We are planning to provide the honour cardholders some benefits,” he said.
Rahman said overall revenue collection has been impressive until November 2017. “We recorded highest growth in revenue at import stage while collection of VAT was also good,” he said.
Overall collection has increased 16.68 percent year-on-year in July-November, he said without mentioning the total figure of the collection.
“We have announced December as the month of compliance.”
“We have asked the field offices to sit and know the reasons because of which the TIN holders did not submit returns yet,” he said.
“We have assigned field offices to encourage them to comply with the NBR rules,” he said.
Currently, there are 32 lakh TIN holders and the NBR expects the number of return filers to rise 28 percent year-on-year to 20 lakh at the end of the fiscal year in June.