Premier Bank slapped with Tk 822cr VAT bill

The revenue authority yesterday slapped Premier Bank with a VAT bill of Tk 822 crore after it failed to furnish documents to support its claim that certain products and services it had sold carried no VAT.

In its submitted returns between January 2013 and October 2017, Premier Bank claimed sales of Tk 5,121 crore worth of products and services to be VAT-exempt and another Tk 362 crore to carry zero VAT. As such, it did not deposit the value-added tax to the public exchequer.

The bank, however, did not attach any document in favour of its claim, prompting the Large Taxpayers Unit, a field office of the National Board of Revenue to ask for evidence many times.

Instead of furnishing documents to support its claim, Premier Bank went to the High Court last month.

The High Court stayed the effectiveness of the LTU letter asking for evidence for six months. Later, the chamber judge of the Appellate Division of the Supreme Court vacated the High Court's stay for two weeks, according to Deputy Attorney General Israt Jahan.

The LTU said they asked for documents again but their requests fell on deaf ears.  Subsequently, in a letter yesterday, the LTU claimed 15 percent VAT on the sales of Tk 5,483 crore worth of products and services.

The NBR field office asked the bank management to explain in 15 days why the money should not be realised.

“This is a primary demand. And we have demanded the VAT as the bank could not submit documents to support its claim,” said a senior official of the LTU declining to be named. The LTU said this is a violation of VAT law.

Contacted, Md Abdul Hai, chief financial officer of Premier Bank, said the bank was yet to get LTU's letter claiming VAT.