In the era of e-commerce or digital marketing, everyone is embracing automation. E-payments or digital transactions of every organization would make it easy for the collection of taxes by the revenue authority. The National Board of Revenue’s (NBR) existing tax administration system in not efficient as expected to track or chase the taxpayers. However, NBR is giving due emphasis on full automation of its services.
NBR Chairman Abu Hena Md Rahmatul Muneem, made this remarks as chief guest at a members’ conference on ‘Income Tax Policy Paper on the upcoming Amendment of Income Tax Ordinance 1984’ held at ICAB auditorium on Sunday.
Nahar Ferdousi Begum, Member (Taxes Legal & Enforcement) and Ranjan Kumar Bhowmik, Member (Tax Survey & Inspection) were present as special guests. ICAB President Muhammad Farooq FCA delivered address of welcome. Mohammad Al Maruf Khan FCA, Partner, Howladar Yunus & Co., Chartered Accountants and Mr. Snehasish Barua FCA, Partner, Snehasish Mahmud & Co., Chartered Accountants presented the Key Note paper.
The NBR Chief said, making tax return might not be mandatory for all. Taxpayer Identification Number (TIN) is required to open a bank account. A widow or an old citizen requires bank account to receive old age allowance from the government. She/he does not necessarily require submitting tax return.
He also said, it is better to chase big taxpayers for increasing the tax collection instead of chasing marginal tax payers considering cost involved in the process.
Ranjan Kumar Bhowmik said, NBR is eager to go for full automation process. Only twenty-two lacs TIN holders submit tax files while the total number of TIN holders is 49 lacs in the country. However, country’s four crores bank account holders are paying taxes through the banks, thought they do not know they are paying taxes, he added. Nahar Ferdousi Begum said, in some cases companies are being benefited from the tax exemptions no doubt, but the government is deprived of huge revenues, this is not encouraging. While calculating the VAT of a company, it shows marginal profit or sometimes the company is not profitable. However, the same company is showing huge profit while floating IPOs in share market, which is otherwise paradox for our business entities. Auditors have the role to ensure better practices in corporate taxes, she added.
The Institute of Chartered Accountants of Bangladesh (ICAB) at the members’ conference came up with its suggestions and recommendations on upcoming amendments on Income Tax ordinance 1984 which included widening the tax net for revenue generation and higher Tax - GDP ratio, increased private sector investment, employment generation, export diversification, effort to attract more FDI (foreign direct investment)in order to improve "Paying Taxes" indicator for ease of doing business in Bangladesh.
ICAB President Muhammad Farooq FCA said, the Institute believes that there is a need for the rationalisation of the tax rate at the higher and lower end of the scale. Tax reform is felt necessary for long time, he added. As an apex professional institute of the country, ICAB finds many justifications to reform our tax system to meet the demand of the changing world, he suggested.
Further, ICAB has taken an initiative to suggest policy changes on the Upcoming Amendment of Income Tax Ordinance 1984 based on the practical experience of the ICAB members. He further said, the paper focuses the general design issues on how to make the tax system in Bangladesh more growth-friendly, simple , transparent and fairer. The conference was moderated by Md. Humayun Kabir FCA, Council Member and Past President of ICAB and the concluding remarks was made by Mohammed Forkan Uddin FCA, Council member, ICAB.
