New VAT law to be effective from budget day

NBR Chairman says

The VAT and Supplementary Duty Act-2012 will come into force from the day of announcement of the national budget for fiscal year 2019-20. National Board of Revenue Chairman Mosharraf Hossain Bhuiyan came up with this statement on Thursday while he was addressing a pre-budget talk with the leaders of Economic Reporting Forum (ERF) at his office in the capital.

“Finance minister has fixed the VAT rates after holding talks with the country’s business community. There is no misunderstanding now so the law will be enacted coinciding with the announcement of the budget,” the NBR chief said. “We will go tough on those who unethically took Tax Identification but do not pay taxes,” he added.

Mosharraf Hossain Bhuiyan hinted not to cutting down the corporate tax rate adding that “whether the corporate tax cut facilitates the business atmosphere then we will consider the matter.” “25 percent corporate tax for listed companies and 35 percent for others are prevailing in almost all countries in the world. The country’s 60 to 65 percent direct taxes come from this regime so it will not be a good decision to cut down the tax rate,” he added.

The NBR chairman urged the country’s business firms to be listed with capital market to enjoy tax facility. “The companies have to introduce transparency in their business activities once they are listed with capital market and that is why many companies show apathy to be a listed one,” he said. Realising the capital market’s continuous falling streaks, Mosharraf Hossain told that they were now working on subsidizing the capital market investors for the second time so that they can survive themselves.

Congratulating the media personalities the NBR chairman said reporters are very sincere about how the country’s revenue collection and Tax-GDP ratio could be upgraded. In the meeting ERF placed an 11-point charter of demand before the NBR to improve the country’s business climate and boosting the revenue earning as well.

ERF’s proposals include - easing of the tax services, upgrading the NBR’s official website, enhancing NBR’s capacity, continuing tax campaign through mobile text for raising awareness, bringing up reforms of direct tax collection. ERF also proposed making the ADR system more effective, making the VAT collection system more transparent, clarifying the possible losses while offering tax exemptions, and making the transfer pricing cell more effective.

NBR member for customs policy Firoj Shah Alam, member for tax policy Kanon Kumar Roy, ERF president Saif Islam Dulal and its secretary Rashedul Islam were also present in the programme, among others.