VAT
NBR counting losses for rampant tax evasion
Despite taking VAT registration, around 22 percent of companies are not submitting their VAT returns.
A large number of individuals are also remaining out of the tax network despite having taxable income.
A total of 26 lakh people or 52.41 percent of the taxpayers did not submit their income tax returns in the last fiscal year. Of the 50 lakh Taxpayers Identification Number (TIN) holders, some 24 lakh submitted their income tax returns during last fiscal year.
As a result, the National Board of Revenue is missing a large amount of revenue.
Though the companies are taking VAT for products or services from customers they are not submitting money to the government exchequer.
The visiting IMF officials have advised the NBR to increase revenue collection in different forms.
Economists and sector insiders have repeatedly suggested reforming the country’s revenue sector in a way that the tax ratio in the GDP would grow as per the volume of the economy.
Read more: 20% year-on-year growth: NBR collected record Tk 8,733cr VAT in Aug
In south Asia Bangladesh is the lowest tax-GDP ratio. A 2016 World Bank report said that the South Asian tax GDP ratio is 19.1 percent in Nepal, 16 percent in Bhutan, 12 percent in India, 9.9 percent in Afghanistan, 9.1 percent in the Maldive while in Bangladesh it is 8.8 percent. In 2017 Bangladesh's position in tax GDP ratio slid to 7.6.
While official data portrays the burgeoning growth of Bangladesh's economy, tax collection shows an almost opposite trend.
The tax collection as a percentage of GDP has been stuck at around 7.6 percent in 2017, the lowest in South Asia and one of the lowest in the world.
This prompts economists to question the disconnect since revenue receipts should increase in line with the expansion of the economy.
Dr Muhammad Abdul Mazid, former NBR chairman, told UNB that large companies might be avoiding VAT through different ways that the NBR cannot detect owing to a lack of capacity.
He suggested enhancing the capacity of revenue officials, along with ensuring good governance in the revenue sector so that people encourage paying taxes in a hassle-free environment.
Dr Ahsan H Mansur, executive director at Policy Research Institute (PRI), said businesses could not fully make a turnaround from the pandemic-induced losses in FY2022 because of an economic slowdown to some extent, which led to lower growth in VAT collection from large companies.
Commenting on the poor collection from the banking sector, he said banks are now going through a bad patch with a slump in profitability.
Mansur also suggested reforming the total VAT and tax sector to grow the revenue collection from domestic sources, in line with global standards, he said.
Read more: Tax return document not needed for loans up to Tk 20 lakh: NBR
"This shows a big mismatch," said Selim Raihan, executive director of the South Asian Network on Economic Modeling.
"It shows that there is no relation between GDP growth and revenue collection although the tax-to-GDP ratio increases in other countries because of the growth of the economy. In the case of Bangladesh, it is a puzzle,” he added.
According to NBR, there are 3.72 lakh companies that have taken VAT registration. Although among them 2.90 companies or 78.21 percent file VAT returns regularly.
However, still, around 22 percent of companies do not submit VAT returns, according to official sources at the VAT Division of the NBR.
A senior official of the NBR's VAT Division told UNB that 3.72 lakh businesses have registered VAT till August this year. Among them, 2.43 lakh or 83.66 percent have filed returns in online platform.
As per the VAT Act, companies which have annual turnover below Tk50 lakh do not need VAT registration.
Job Circular: Recruitment in multiple positions in Customs, Excise and VAT Commissionerate
Customs, Excise and VAT (Appeals) Commissionerate, Dhaka-1 has published a job circular for the recruitment of manpower for several posts under the revenue sector. 12 appointments will be made to 9 category posts in this institution. Interested candidates have to apply by filling the form online. Recruitment Details for the Job Circular of Customs, Excise and VAT Commissionerate.
Recruitment in Customs, Excise and VAT Commissionerate
1. Post Name: Senior Assistant
No. of Posts: 1
Eligibility: Must be a graduate or equivalent from a recognized university. Must have computer skills. Minimum speed in word processing, data entry or typing should be 25 words per minute in Bengali and 30 words per minute in English.
Pay Scale: TK.10,200–24,680 (Grade-14)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
Read Job Circular: 15 job opportunities in Walton
2. Post Name: Cashier
No. of Posts: 1
Eligibility: Bachelor's Degree in Commerce or equivalent from a recognized University. Must have computer skills.
Pay Scale: Tk 10,200-24,680 (Grade-14)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
3. Post Name: Cashier cum Computer Operator
No. of Posts: 1
Qualification: HSC or equivalent pass. The minimum speed of transcription in English and Bengali is 45 and 70 words per minute respectively. Minimum speed in word processing, data entry or typing should be 25 words per minute in Bengali and 30 words per minute in English.
Pay Scale: Tk 10,200-24,680 (Grade-14)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
Age limit raised by 3 years and 3 months for entering govt service; not applicable for BCS
4. Post Name: Office Assistant cum Computer Numerologist
No. of Posts: 2
Qualification: HSC or equivalent pass. Minimum speed in word processing, data entry or typing should be 20 words per minute in Bengali and 20 words per minute in English.
Pay Scale: TK.9,300-22,490 (Grade-16)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
5. Post Name: Record Keeper
No. of Posts: 1
Qualification: HSC or equivalent pass. Must be computer literate.
Pay Scale: TK.9,300-22,490 (Grade-16)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
Read Job Circular in Polli Bidyut: Bangladesh Rural Electrification Board will recruit 94 people
6. Post Name: Driver
No. of Posts: 2
Eligibility: Class VIII or equivalent pass. Must have valid driving license with three years practical experience.
Pay Scale: TK.9,300-22,490 (Grade-16)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
7. Post Name: Sepoy
No. of Posts: 1
Qualification: SSC or equivalent pass. Height minimum 5 feet 4 inches for males, minimum 5 feet 2 inches for females. Chest size minimum 30-32 inches (both cases).
Pay Scale: TK.9,000-21,800 (Grade-17)
District candidates can apply: Candidates from all districts except Kishoreganj, Laxmipur and Siraganj districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
Read Government Job Circular 2022: Multiple job opportunities in Ministry of Lands
8. Post Name: Office Assistant
No. of Posts: 2
Qualification: SSC or equivalent pass. Must be in good health.
Pay Scale: TK.8,250-20,010 (Grade-20)
Districts candidates can apply: Candidates from all districts except Mymensingh, Sirajganj, Brahmanbaria, and Feni districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
9. Post Name: Security Guard
No. of Posts: 1
Eligibility: Class VIII or equivalent pass. Must be in good health.
Pay Scale: TK.8,250-20,010 (Grade-20)
Districts candidates can apply: Candidates from all districts except Mymensingh, Sirajganj, Brahmanbaria, and Feni districts and candidates from all districts under Orphan and Physically Handicapped quota can apply.
Read Resume vs CV: What are the key differences?
Age limit
Minimum 18 years as on 30 September 2022 and maximum 30 years as on 25 March 2020 are eligible to apply. However, children of freedom fighters or martyred freedom fighters and physically challenged candidates whose age is not more than 32 years on March 25, 2020 are also eligible to apply. The age limit is 30 years for the grandchildren of brave freedom fighters. Age limit is relaxable up to 40 years for departmental candidates.
How to apply
Interested candidates should apply by filling the form on this website (http://ceval.teletalk.com.bd/). Detailed information regarding application procedure, fee submission and recruitment can be known in this link. (http://ceva1.gov.bd/notice/detail/18)
If there is any problem in applying online, you can call 121 from any teletalk phone or mail at [email protected] or [email protected]. In this case, the name of the organization and position, user ID and contact number must be mentioned in the subject.
Application fee
Within 72 hours of filling the form online, examination fee is 200 taka for post 1 to 3 and total taka 223 including teletalk service charge 23 taka and for post 7 to 9 taka 100 and total taka 112 including teletalk service charge 12 taka from prepaid teletalk number.
Read Best Job Searching Websites in Bangladesh
Application Deadline:
3 October to 24 October 2022, up to 5 PM.
20% year-on-year growth: NBR collected record Tk 8,733cr VAT in Aug
National Board of Revenue (NBR) collected Tk 8,733 crore of revenue from value added tax (VAT) in August – showing a 20 percent year-on-year growth.
NBR’s collected VAT revenue in August is Tk 519 crore more than the target.
In this regard, NBR member (VAT) Moinul Khan said that government expenditure has decreased due to cost-cutting measures. Still, due to various initiatives and efforts, more VAT has been collected.
Read: Tax return document not needed for loans up to Tk 20 lakh: NBR
Generally, more VAT is collected from government purchases than from the private sector. This time there is an exception, he said.
In the first two months of the current financial year, collection of income tax, VAT, and customs amounts to Tk 40,270 crore, which is Tk 3,319 crore less than the target. In the current financial year, the total revenue target is Tk 3.70 lakh crore.
Read: Black money whitening got little response in FY 22: NBR data
According to NBR sources, in the first two months, Tk 10,373 crore have been collected in the income tax sector and Tk 14,863 crore in the customs sector.
In July-August, VAT from 30 small sectors amounted to Tk 4,869 crore. On the other hand, Tk 10,165 crore VAT has been collected from the private sector – retail and wholesale, rod-cement, hotels, and restaurants.
300,000 VAT collecting machines to be installed in Dhaka, Ctg by pvt firm
A private firm, Genex Infosys Limited, will provide and install 300,000 VAT collecting machines in Dhaka city, adjoining areas and Chattogram city in the next three years.
Cabinet Committee on Government Purchase (CCGP) at a meeting on Wednesday approved a proposal of the National Board of Revenue (NBR) to select Genex Infosys as a vendor to collect value added tax (VAT) on behalf of the government.
Finance Minister AHM Mustafa Kamal presided over the virtual meeting while members of the committee attended it.
Read Black money whitening got little response in FY 22: NBR data
Genex Infosys was selected through an open tender, said additional secretary of the Cabinet Division Abdul Barik while briefing on the decisions of the committee.
He said the Genex as a lowest bidder won the contract in three lots to supply and install Electronic Fiscal Device (EFD) and Sales Data Controller (SDC) or VAT collecting machines at different types of retail shops.
Earlier, the Cabinet Committee on Economic Affairs gave its nod in-principle to this decision of NBR on August 31.
Read NBR supports Made in Bangladesh brand: Chairman
Barik said the vendor will supply and install the machines at its own cost and in return it will get 0.52-0.538 percent of the collected money as service charge while depositing it to the government.
It will also carry out the operation and maintenance work as well, he added.
According to NBR officials, it’s not possible for the government to operate so many machines across the country, that’s why service outsourcing is being done.
Read NBR dreams to cross revenue Tk3.0 lakh crore in FY 22
However, installation of EFD machines started two years ago but there is not much speed in its operation.
Budget to propose special VAT reduction to boost small businesses
The government plans a special Value Added Tax (VAT) reduction facility for small businesses to rebound the sector from the adverse impact of the pandemic.
Though the large manufacturers have rebounded from the pandemic's impact, the small sector is struggling to survive. The government is considering reducing existing VAT from 5 percent to 1.5 percent as an incentive to boost the small sector.
The budget related official of the national board of revenue (NBR) said in the global economic context, the country's small businesses are at risk.
In the post pandemic period, they are going through various adversities including high VAT and capital crisis.
If the proposed rate is implemented, the tax burden on the retail and wholesale business sector will be reduced and goods and services will be cheaper. The consumer will be benefited.
Small traders said that 5 percent VAT is too much for them. In order to pay VAT at this rate, their business has to add at least 33 percent value addition.
Read: Traders urged to keep market stable ahead of Eid-ul-Azha
But in the current reality, the maximum value addition in this sector is 10 to 15 percent. So, VAT should be levied from this sector on the basis of what is net or actual value addition.
As per rule, the government levies VAT at the applicable rate based on the amount of value added in any business. This VAT is paid at the time of monthly return.
Dr Abdul Mazid former chairman of NBR told UNB, "The main problem of small traders is that they do not keep any account for the transactions they make. That is why no rebate or VAT is refunded from the government. If this could be done, the VAT burden would be reduced.”
Read: Inflation, unstable forex rate major challenges: BB governor
He said, "In order to increase the collection of VAT from this sector, it is necessary to automate all the eligible businesses. In that case, the collection will be many times more than at present.”
NBR to speed up this fiscal's VAT collection
The National Board of Revenue (NBR) has asked its field offices to expedite the Value Added Tax (VAT) collection as the collection from the pocket is only 56.15 per cent in the first eight months of the current fiscal.
In this connection, the revenue collecting authority asked for attaining the target of the revenue collection keeping the present condition in mind and to put emphasis on establishing intensive communication with the big companies.
The NBR data shows that total revenue collection from VAT wing fixed in the budget for 2021-22 fiscal was Tk 127747.58 crore whereas the collection till February 2022 is Tk 71,736.88 crore, which is only 56.15 per cent.
The target for VAT collection from import level was Tk 45,554.76 crore. But till February of this year the NBR has been able to collect Tk 28,403.60 crore where in the month of February the collection was 4061.67 crore.
The collection till February 2021 was Tk 22,709.32 crore while the collection in the month of February 2021 was Tk 3050.02 crore.
It means the growth in month to month basis is 33.17 per cent while it is 25.07 per cent considering the collection of the first eight months of the two fiscals.
On the other hand, target for VAT collection from local level was Tk 82192.82 crore. But till February of this year the NBR has been able to collect Tk 43333.28 crore where in the month of February the collection was Tk 5615.67 crore.
The collection till February 2021 was Tk 38,734.97 crore while the collection in the month of February 2021 was Tk 5312.55 crore.
It shows that the growth in month to month basis is 5.71 per cent only while growth is 11.87 per cent considering the collection of the first eight months of the two fiscals.
A senior official of the NBR said that in the present situation of the world or the country during the pandemic is not very conducive for revenue collection with sizeable growth.
READ: NBR announces tax exemption for donation to third gender
“We are all aware about the present situation, this might improves as the world and the country as well are coming out from the shadow of the pandemic situation gradually. Whatever it is, we have to step forward with necessary actions to attain the target,’ he said.
He mentioned that good communications with large companies that usually give significant amount of VAT would be a better tool for enhanced revenue collections.
He said that officials would have to depend on the items like cigarettes, mobile, bank, Bkash, internet and medicine, which pay higher revenue to the national exchequer.
Besides, the NBR official said that special attention needs to be given on collecting advance VAT and outstanding revenues from various business entities.
The revenue target for the NBR for fiscal 2021-22 has been set at Tk 330,078 crore.
Of the total target the VAT wing will contribute the lion share with Tk 127,745 crore. The target for Income Tax and Tax on Profit has been set Tk 104, 952 crore.
The revenue collection from import duty will be Tk 37, 807.18 crore, Tk 55,225.26 crore from from Supplementary Duty, Tk 55.45 crore from export duty, Tk 3685.69 crore from Excise Duty, Tk 1529.90 crore from travel tac while Tk 1050 crore from other taxes and duties.
Gazette issued reducing VAT on edible oil import
The government has issued gazette notification reducing Value Added Tax (VAT) at import level by10 per cent to make it 5 per cent for soybean and palm oil.
Read: Gazette notification: VAT on edible oil withdrawn
The notification will be effective immediately until June 30.
Gazette notification: VAT on edible oil withdrawn
The government on Monday waived Value Added Tax (VAT) on all types of edible oil to try to rein in the soaring prices of the essential commodity.
The National Board of Revenue (NBR) issued a gazette notification in this regard. The notification stated that this tax relief will be effective from Monday. Traders will get this facility till next June 30.
The traders have been demanding withdrawal of VAT at the import stage, but the NBR notification did not say anything about import.
Earlier on Thursday, Finance Minister AHM Mustafa Kamal told a reporter after a government procurement meeting that the VAT has been withdrawn to control the market prices of edible oil.
Also read: Consider maximum cut in import VAT on edible oil: Cabinet directs NBR
Later, the finance minister said that the tariffs on essential commodities including edible oil, sugar and peas will be withdrawn soon.
The NBR imposed 15 per cent VAT on soybean at production level and 5 per cent at the consumer level.
Commerce Minister Tipu Munshi at a press briefing at his secretariat on the occasion of consumers’ rights day said that VAT on edible oil imports will be reduced by 10 per cent and VAT at the consumer level by 5 per cent.
Also read: 5-litre can of soybean oil: The best gift a newly married couple could get
At the same time, 15 per cent VAT will be withdrawn at the edible oil production level, he said.
Consider maximum cut in import VAT on edible oil: Cabinet directs NBR
The Cabinet on Monday directed the National Board of Revenue (NBR) to take immediate steps to curtail the VAT on edible oil import to the lowest ceiling in the wake of the rising price of the essential item.
The directive came from the Cabinet’s meeting chaired by Prime Minister Sheikh Hasina who joined it virtually from her official residence Ganobhaban.
Read: Man arrested by DMP for stockpiling Soybean oil
Other ministers were connected from the cabinet room of the Cabinet Division in Bangladesh Secretariat.
The government has already waived VAT at the retailer-level as the law minister told the meeting that he signed the paper (SRO) in this regard, said Cabinet Secretary Khandker Anwarul Islam told reporters after the meeting.
“There is now 15 per cent VAT on edible oil at the import level. The NBR was directed to consider slashing it as much as possible until further order and take immediate action in this regard,” he said.
Slashing VAT, taxes on essential commodities during Ramadan under consideration: Home Minister
Home Minister Asaduzzaman Khan Kamal on Sunday said the government decided to reduce or withdraw VAT (value added tax) and taxes to keep the prices of some daily commodities, including edible oil, at a tolerable level ahead of Ramadan.
“We will announce soon steps on reducing taxes and VAT if necessary and how much on edible oil or sugar or anything else if it is levied on daily commodities,” said the minister at an inter-ministerial meeting held at the Cabinet Division at the Secretariat.
However, he did not specify which products will be included in this action.
Also read: VAT on import of edible oil, other commodities withdrawn: Minister
Briefing reporters after the meeting, Asaduzzaman said, "You know the price of edible oil is rising all over the world. We see prices rising every day which is affecting our country.”
“The prices of other commodities can also go up during Ramadan, so we sat down with that in mind,” the minister added.
He said, "We are also making arrangements to import electricity keeping in mind the increasing demand during Ramadan."
He further said the supply of diesel and gas may be reduced. “We are taking necessary steps to keep these in order so that there is no shortage of electricity and people do not suffer during Ramadan,” he assured.
“We will encourage everyone to import the essentials to keep the market stable.”
However, the supply of wheat may be another problem as it is imported from Ukraine-Russia, said the minister.
“We will continue our efforts to keep the rice and wheat market stable.”
The Cabinet Division sat in a meeting with several ministries today to control commodity prices ahead of Ramadan.
Also read: Stockpiling of daily commodities for higher profits not acceptable: HC
Apart from the home minister, Commerce Minister Tipu Munshi, Agriculture Minister Md Abdur Razzaque, State Minister for Ministry of Power, Energy and Mineral Resources Nasrul Hamid, Cabinet Secretary Khandker Anwarul Islam, Inspector General of Police (IGP) Benazir Ahmed and other top officials attended the meeting.