The revenue authority will frame the value-added tax measures for the upcoming fiscal year based on the existing VAT Act 1991, bringing about a collective sigh of relief from the business community, said the chief of the National Board of Revenue yesterday.
“But uniformity will be brought in rates applied for various sectors. And this will be done based on consultation with you,” Md Mosharraf Hossain Bhuiyan told businessmen at a dialogue organised by the Federation of Bangladesh Chambers of Commerce and Industry.
The government's attempt to impose a uniform 15 percent VAT this year was met with vehement opposition.
Bhuiyan though is in favour of making several rates of VAT. “We will slowly proceed in line with that. I will try to protect the interest of domestic industries.”
At the dialogue, businessmen from different sectors alleged harassment by taxmen and urged the government for not slapping a high tax burden on compliant taxpayers.
Bhuiyan said the NBR would not harass any taxpayer.
“I have given instructions to prevent tax evasion,” he said, while calling upon businesses to pay proper taxes so that the government can attain its revenue collection goals and carry out development programmes from the state coffer.
The NBR chief suggested businesses refrain from importing goods through mis-declaration, and under- and over-invoicing.
“This affects the business environment. Honest businesses become affected when we take steps to prevent this sort of activities.”
Bhuiyan also warned businesses about the abuse of duty-free import benefit of raw materials under the bonded warehouse privilege as local industries get affected when those products are sold in the domestic market.
“This will be controlled with an iron hand,” he added.
FBCCI President Md Shafiul Islam Mohiuddin said the bonded warehouse benefits are abused through mis-declaration of imported goods. “We have to work together to wipe out this type of black sheep.”
Citing the government's move to implement the online VAT payment, he said the system should be developed in the light of the VAT law framed in 1991.
The apex trade body demanded the government assess the impact of the new VAT law framed in 2012 through an independent organisation prior to its implementation.
A high-powered committee should also be formed to finalise rules for online registration for VAT, it said.
Citing the increase in the size of the budget and the consequent spike in revenue collection goals, Mohiuddin said the business community becomes worried when increased tax collection targets are fixed to attain higher budgetary targets.
“Businesses are not consulted in fixing targets. And extra pressure is piled on businesses to achieve the higher tax collection target. Then, the extent of misuse of rules and harassment increases.”
He urged the NBR to expand the tax net to boost tax collection. “The landscape of revenue collection will change once all people with taxable incomes are brought under the net,” he said.
The FBCCI appealed to the revenue authority to withdraw the provision of advance income tax at the import level.
Siddiqur Rahman, president of the Bangladesh Garment Manufacturers and Exporters Association, demanded an end to the harassment faced by the businessmen.
“Relieve compliant businessmen from harassment. We have no problem if you punish anyone for wrongdoing. But do not harass those who do business properly.”