Tender participation

Tax deposit receipt mandatory

The National Board of Revenue (NBR) has planned to make submission of the receipt of income tax return deposit mandatory for participation in any tender and renewal of fitness certificate of vehicles and trade licence to plug tax evasion.   

Sources said the NBR recently sent letter to the secretaries of the 10 ministries and departments from where the revenue authorities collect the highest income tax seeking their cooperation in this regard. The NBR has also made a similar request to the Bangladesh Road Transport Authority (BRTA).

A section of people only take TIN certificate to get the service but they do not submit returns or pay taxes, the NBR sources said.    

NBR Chairman Abu Hena Md. Rahmatul Muneem requested the secretary of the power department to make the receipt of return deposit compulsory while contractors participate in the tenders of the ministry.

Contractors can now participate in tenders only with a Tax Identification Number (TIN) certificate.

There are allegations that many contractors take TIN just to participate in the tender. Although the tax is deducted at source while paying the bills of the contractors, they do not submit return at the end of the year.

Car owners take the fitness certificate of the car every year and they have to pay Tk 15,000 or Tk 25,000 as tax every year for taking fitness certificate. From now on, the car owners have to show this payment in their returns.

According to BRTA, more than two lakh private car owners take fitness certificates every year. Before taking the fitness test, one has to pay a fee of Tk 15,000 or Tk 25,000 in advance as well as advance tax. When depositing money in the bank, they have to show the return deposit receipt instead of the TIN certificate.

Earlier in March, the NBR held a meeting with senior officials concerned of the 10 ministries. The meeting was attended by officials from the power department, Bangladesh Road Transport Authority (BRTA), local government department, housing and public works ministry, primary and mass education ministry, secondary and higher education department and other concerned ministries.

The meeting observed that many people only take TIN certificate to get the service, but do not submit returns or pay taxes.

The NBR in its letter to various departments said that there is an obligation to submit an e-TIN certificate in order to participate in the government procurement tenders. This TIN certificate is used for renewal of trade licence, renewal of motor vehicle fitness. But many of the contractors do not file returns. A motor vehicle owner renews a motor vehicle only with a TIN certificate without submitting a return. 

As a result, many TIN holders are evading taxes without filing returns. Therefore, in the case of providing government services and contracts, along with the TIN certificate, it was requested to make it mandatory to submit the acknowledgment of receipt of return submission.

Many take e-TIN for buying a car, but do not submit return.

A NBR official said that the tax collection would increase if a receipt for the return deposit was sought.