A significant number of smokeless tobacco (SLT) manufacturers of Bangladesh have managed to slip away from the government's tax net, according to a study.
The study, titled ‘Factors Inhibiting Smokeless Tobacco Tax Payments by Smokeless Tobacco Manufacturers Operating Outside the Tax Net in Bangladesh’, was conducted to find out why and how SLT manufacturers escape the tax net and to also present a set of recommendations to plug such holes in the tax net causing revenue loss with assistance from Campaign for Tobacco Free Kids (CTFK).
To disseminate the findings of the study with the National Board of Revenue (NBR), a webinar was jointly organized on Monday, by a number of anti-tobacco organizations, including National Heart Foundation, Dhaka Ahsania Mission, UBINIG, Voice and PROGGA. The findings of the study were presented by Dr. Nasiruddin Ahmed, the leader of the research team and former Chairman of the National Board of Revenue (NBR).
Zakia Sultana, NBR Member (VAT Audit and Intelligence) attended the event as chief guest.
While addressing she said that, "SLT use should be reined, for the sake of revenues and public health. Reducing SLT use would also reduce health sector expenditure."
Md. Mustafizur Rahman, Lead Policy Advisor of CTFK, Bangladesh and former chairman of Bangladesh Chemical Industries Corporation (BCIC) delivered address of welcome while the discussion session was participated by a wide range of NBR high officials, leaders of the anti- tobacco organizations and experts including CTFK Research Director Maria G. Carmona, CTFK South Asia Programs Director Vandana Shah.
The study findings reveal that among the 483 SLT factories (435 zarda and 48 gul factories) of Bangladesh, only 218 pay taxes. The study surveyed on 88 SLT manufacturers (81 zarda and 7 Gul), spanning over 29 districts of the country's 08 administrative divisions, who are out of the tax net and also revealed that 33 percent of them do not even have a valid trade license. 91 percent manufacturers produce SLT products manually.
The study also shows that SLT products are manufactured primarily in small unmarked factories or houses. The total monthly gross turnover is estimated at Tk.2.7 crore.
