Standard Chartered Bank and Citibank have joined the National Board of Revenue's e-payment foray to facilitate their corporate clients to pay taxes online.
"It is a big step forward. It will enable account holders of the two banks to clear big amounts of taxes, including VAT and customs duty, through their accounts sitting in office," a senior official of NBR said, seeking anonymity.
On Monday, Standard Chartered and Citibank signed separate agreements with Sonali Bank, a partner in NBR's e-payment initiative, to offer their corporate client's the facility to pay taxes through their accounts.
This is the first time two banks having online banking facilities joined NBR's electronic tax payment platform, which has so far received a lukewarm response since its launch in May 2012.
NBR officials said the electronic tax payment system did not support paying large amounts of taxes through account to account transactions. So far, individual taxpayers are able to pay taxes by debit or prepaid card.
However, VAT and customs duty online payment remain low as it is not feasible to pay large sums of money through electronic cards, said Sonali Bank officials.
Since the system's launch, NBR has received about Tk 5 crore in taxes through the portal, mainly from individual taxpayers; of the amount, none came from VAT and a negligible amount came as customs duties, officials added.
NBR and Sonali Bank officials expect the trend to change after corporate clients of the foreign banks begin to pay taxes through their accounts.
"We expect a spiral in the payment of large amounts of taxes through the e-payment gateway," said a Sonali Bank official, adding that the system that is currently being developed would be ready for use by mid-March.
More banks with online banking facilities will join the foray this year, he said.
Rashed Maqsood, managing director of Citibank, said the agreement lays the foundation for Sonali Bank to integrate Citi into the tax payment architecture of the government, which currently supports tax payments for individuals only.
“Once the new system goes live under this agreement, Citi's client will be benefitted for being able to pay tax online.”
Officials said the payment of taxes online would save taxpayers time.
"Our clients will be able to generate challans or receipts for tax payments sitting in their offices," said Abrar A Anwar, managing director for wholesale banking of Standard Chartered.
“This is a great step forward for digitisation of payment services because NBR is one of the main receivers of funds from payment of taxes, VAT and customs duty.”