Meter holders must have TIN

The National Board of Revenue has decided to bring all electric holding meter possessors in the city areas under the tax net to ensure tax compliance and increase revenue collection. As part of the move, the revenue board from the upcoming fiscal will make the Tax Identification Number (TIN) mandatory for getting this utility service in city corporation and municipal areas.

The move may find around 20 lakh new taxpayers only from two Dhaka city corporations, tax officials believe. Kanon Kumar Roy, NBR member for tax policy told Bangladesh Post that they would be able to have a large number of potential taxpayers through the drive as almost all home owners in the city areas are wealthy and tax eligible.

According to sources, there are around 20,00,000 electric meter holders in the Dhaka city. The NBR has planned to initially implement the programme in Dhaka city and gradually extend it to all city corporation and municipal areas. There are currently three electricity supply agencies, including Dhaka Electric Supply Company (DESCO), and Dhaka Power Distribution Company (DPDC), and are in operation to distribute power in the Dhaka city area.

A senior tax official told this correspondent that they have already held meetings with these three power supply agencies to make a pathway on how the electric meter holders could be brought under tax net. NBR will soon formulate a set of rules and regulations with regard to this issue to implement the programme.

According to NBR sources, once the regulation is adopted, the power supply agencies will not issue any electric meter to anyone without TIN. Besides, those who have already obtained electric meter and do not have TIN, will have to obtain it compulsorily and mention the number while making the immediate next electric bill payment.

The revenue board will cross-check the authenticity of TIN and issue an authenticity number that will be operated automatically, the source said. To standardise the overall revenue system, the NBR earlier chalked out a plan to increase the share of income tax to 50 percent of the total revenue collection by 2021, where it is now around 35 percent.

However, several studies show that the country’s 95 percent tax-eligible people now remain out of the tax-net while the rest 5 percent people pay income tax properly. Currently, some 40 lakh people are under the net where only 20 lakh submit tax returns regularly. Finance minister, AHM Mustafa Kamal, in his budget speech said that they had a plan to increase the actual taxpayers to the one crore benchmark in the next few years to streamline the income tax wing.
''In line with the move, we are finding out all possible sources from where taxpayers could be found and hope that we will find a big number of prominent taxpayers from electric meter possessors," Kanon Kumar said.

Apart from this, the exchequer has also made the TIN mandatory for the buying and sale of landed property from where a substantial number of taxpayers could also be found, tax officials said. From the next fiscal, while exchanging property, both the buyer and seller will mandatorily mention their TINs on the deed.

If anybody of them does not have TIN, he or she must obtain it before the exchange of the property. If anybody mentions fake TIN on the deed, it as per law, will be cancelled and the owner, due to this fraudulence, will lose his authority over his property, tax officials said. "This move could bring wealthy people under tax-net," Kanon Kumar added. The NBR aligned with the country’s 7th Five-Year Plan has set a roadmap to increase the Tax-GDP ratio to 15.3 percent by 2019 which is now around 10 percent.