In the current (2023-24) financial year, NBRK has been given a target of 430 thousand crores of revenue. However, in the first six months (July to December), the revenue collection was only 38 and a half percent of the annual target. During last July-December customs tax of Tk 1 lakh 65 thousand 630 crore has been collected.
At that time, NBR’s revenue collection target was 1 lakh 88 thousand 856 crores. Imports, VAT and income tax – none of these three sectors have met the target in the last six months. Among these three sectors, income tax sector has the biggest deficit in revenue collection. In six months, the deficit in this sector stood at 8 thousand 593 crores.
In the first six months of the fiscal year, the deficit in the VAT sector is Tk 6,700 crore. At this time, 64 thousand 737 crores of VAT was collected, the target was 70 thousand 808 crores of taka. Litigation is one of the reasons for not meeting the target in VAT collection. According to NBR’s calculation, 24 thousand 641 crore rupees are withheld due to Value Added Tax (VAT) alone. For this reason, 10 thousand 301 cases have been filed at different times. Every month a large number of cases are settled but more cases are being filed. Although the National Board of Revenue (NBR) has taken various initiatives to prevent litigation, it is not working.
Short-term dispute resolution process or customs and VAT appellate tribunals under ADR or NBR, beyond the court-ordered process, nothing can reduce the complexity of cases. Most cases are in disposal of VAT certificate. There are 3 thousand 559 cases in this sector, against which the government’s revenue is 264 crore rupees.
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Apart from this, up to January this year, 83 crore rupees have been withheld against 27 cases in the Appellate Commissionerate, 248 crore rupees have been withheld against 202 cases in the Appellate Tribunal, 18 thousand 782 crore rupees have been withheld against 3 thousand 486 cases in the High Court department. 1 thousand 279 crore against 139 cases in Appellate Division, 1 thousand 532 crore against 1 thousand 582 cases in Musak 14.1, 386 crore against 35 cases of Alternative Dispute Resolution (ADR) and 2 thousand 63 crore against another 1 thousand 271 cases The revenue of the government is withheld. In total, against 10 thousand 301 cases, the revenue of 24 thousand crore rupees is stuck.
When asked about this, an official of NBR said on the condition of anonymity that VAT has been introduced in the country since the 1990s. VAT came into force from July 1991 through the enactment of the VAT Ordinance. Basically from that time VAT evasion, VAT cases also started. Companies do not want to pay VAT. These companies are also willing to go to the High Court to waive VAT.
VAT has been introduced in the country since the 1990s. VAT came into force from July 1991 through the enactment of the VAT Ordinance. Basically from that time VAT evasion, VAT cases also started. Companies do not want to pay VAT.
According to sources, 171 new cases were registered in eight sectors of VAT in January this year, in which revenue of Tk 279 crore was withheld. In the same month, 139 cases were disposed of, where a revenue of Rs 68.5 crore was exempted (NBR received). As of January 2024, 1,590 cases have been settled, out of which a revenue of Tk 2,759 crore has been deducted.
However, NBR has taken various initiatives to reduce the number of cases, said the member of the organization (VAT audit). Md. Sahidul Islam. He told Jago News, ‘Field offices have been instructed to settle cases quickly through more effective ADR (Alternative Dispute Resolution) system. It has been possible to reduce cases a little more than before.’
National Board of Revenue Building/ File photo
Abdul Mannan, a former member of NBR’s VAT branch, said, ‘The institutions do not want to pay a large amount of VAT together. That’s why they sued and withheld VAT. They waste time in various processes including cases, hearings, appeals. However, if they lose the case, then they have to pay the full amount of VAT along with the penalty.
Organizations do not want to pay large amounts of VAT at once. That’s why they sued and withheld VAT. They waste time in various processes including cases, hearings, appeals. However, if they lose the case, then they have to pay the full amount of VAT along with the penalty.
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NBR is fixing the target of collection of revenue of about 5 lakh 17 thousand 700 crores from the Musak sector in the past, current and next financial years (2023-24, 2024-25 and 2025-26). However, the biggest obstacle in this realization is the VAT case and the revenue stuck in it.
Those concerned say that NBR is giving importance to installation of Electronic Fiscal Device (EFD) and Sales Data Controller (SDC) machines to increase VAT collection. Three lakh EFD machines will be installed across the country in five years. If this plan is successful, revenue collection will increase. Besides, the difference between VAT rates will also be reduced. Many sectors currently have different VAT rates, including 15 percent on retail and 7.5 percent on e-commerce, which will be reduced. Besides, NBR has announced administrative reforms to increase VAT collection.
SM/KSR/JIM
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