The National Board of Revenue has asked its field offices to track the people who have not submitted tax returns this year despite having taxable income, said its Chairman Md Mosharraf Hossain Bhuiyan yesterday.
“We have directed our officers to contact those who have Taxpayer Identification Numbers (TIN) and taxable income but have not furnished returns. I have asked to ensure return submission and tax payment by those non-filers,” he said.
Only 22 lakh, or 48 percent, of the 46 lakh TIN-holders submitted tax returns this year.
He said his office has already discussed the issue on non-filing of income tax returns.
Bhuiyan was speaking at a press briefing at his office to announce programmes aimed at observing the Value Added Tax Day and VAT Week.
The NBR will honour top VAT-payers for fiscal 2017-18 apart from organising rally and other awareness-raising campaigns on VAT, the biggest source of revenue for the tax administration.
The number of total tax returns grew 10 percent to 22 lakh this year. The total count would increase by nearly 50,000 after companies file returns by mid-January.
The NBR chief also talked about sluggish growth of revenue collection.
Collection grew in October but the overall receipt growth was low owing to a fall in VAT collection in the previous months as many businesses are yet to get accustomed to the online VAT system under the new law introduced in July.
The number of VAT returns was 105,000 against 112,000 entities with VAT registration.
Falling imports and exports, prevalence of various exemption such as the 93 percent waiver on supplementary duty on liquefied natural gas import, and reduction of receipt from cigarettes, the biggest source of indirect tax, resulting from declining smoking for high prices, affected the collection.
Besides, the scope to adjust advance tax with total payable VAT and avail refund as well as full rebate benefit on electricity, gas and utility bills affected the overall collection, Bhuiyan said.
He, however, said the overall collection would soar in the second half of the fiscal year because of increased deposits of VAT and higher collection of VAT at source.
The NBR will start installing electronic cash registers, termed as electronic fiscal devices (EFDs), from this month at large retail and wholesale stores as the first consignment of the equipment arrived at the Chattogram port.
The NBR earlier placed an order to a tenderer to buy 100,000 EFDs for setting the devices at shops to monitor transactions at trading level.
Primarily, 10,000 EFDs would be supplied and installed at shops and successful installation would follow the supply of the rest of the EFDs, he added.
The NBR also has plans to buy 100,000 more EFDs and increase the number gradually.
“We expect installation of half of the total purchase.”
Bhuiyan, however, said installation of the EFDs would not boost revenue collection substantially as VAT from trading stage accounts for 3 percent of the total annual VAT collection.
Large taxpayers, various industries and services sector provide 80-90 percent of the total collection and dependence on large firms will remain high even after installation of the EFDs.
He said collection of trade VAT may increase to 10-15 percent of the total collection.
Responding to a query on whether stores would be given the EFDs for free, he said the machines would be provided at a price and the money would be realised gradually from traders.
FBCCI’s comment unfortunate
Responding to a question on Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) President Sheikh Fazle Fahim’s criticism of the NBR’s role, Bhuiyan said: “I do not find any interpretation of why he said so.”
At the inauguration of the ‘Ceramic Expo Bangladesh 2019’, Fahim criticised the chairman and officials of the NBR, saying they lack efficiency.
The NBR holds a lot of meetings with trade bodies to listen to the concerns and views of local industries ahead of the preparation of the budget.
And it usually imposes duty to discourage imports of consumable items in order to support domestic businesses although there are suggestions to liberalise trade, he said.
No other countries collect so high an amount of tax from customs, he said, citing that customs duty accounts for 28 percent of the total revenue collection.
“We are allowing capital machinery import at only one percent tariff and industrial raw materials at 5 percent to facilitate local businesses,” he said, adding that the garment industry gets a host of tax benefits, including low tax at source of export.
“I heard a lot about the issues of businesses in the last two years. Even after the budget declaration, we relaxed rules, particularly related to VAT. If they complain about harassment even after all of these, this would be very unfortunate,” he said.