THE New Nation reported that the Large Tax-payer Unit (LTU) has geared effort to realize over Tk 23,000 crore in arrear value added tax (VAT) from four state-owned entities — Petrobangla, Titas Gas, Bakhrabad Gas Company Limited (BGCL) and Bangladesh Telecommunication Regulatory Commission (BTRC). As the row between National Board of Revenue (NBR) and the companies continues, their financial indiscipline is making people to wonder more loopholes within the system. The question is why the companies have not deposited the VAT they have realized and used it otherwise. It is too big amount to be ignored. This is the crux of the problem. The companies however say the NBR is overestimating the arrears.
We know that to minimize losses, the utility providers have frequently hiked the tariff, almost every year and they realized more VAT accordingly. But failing to deposit the VAT to NBR despite such regular tariff hikes show big financial irregularities may be at work in other establishments as well. The management of public utility companies are systematically milking consumers to overcome losses but in many cases they use the money to hike their salary and allowances while keeping defaulter when it comes about paying the NBR. It appears that they were mindless to run into default. The question is why the management responsible for the default should not be punished because they are always pushing proposals to tariff hike to make their own fortune.
Reports said Petrobangla owes the highest amount of Tk 13,036 crore followed by Titas Gas Tk 1,973, Bakhrabad Gas Company Limited Tk 191 crore and Bangladesh Telecommunication Regulatory Commission (BTRC) Tk 279 crore to the NBR. It says Titas Gas did deposit VAT and SD collected from clients between April 2014 and December 2014. Bakhrabad did not pay from April 2014 to January 2015. VAT and SD at a rate of 15 percent are applicable to clients including industries, electricity, fertilizer, CNG, commercial and households. The gas distribution companies have collected the tax but Titas Gas deposited VAT collected from industries between April 2014 and December 2015, it did not depot the SD from industries and VAT and SD from other sectors. Bakhrabad Gas was guilty of the same.
Bangladesh has 8.5 lakh firms registered under VAT but only 32,000 submit tax returns and pay VAT to makes it clear that VAT is confined to a limited area. Data showed that 157 firms accounted for 55 percent of the total of Tk 56,080 crore collected as VAT and SD in fiscal 2015-16. It shows if all were paying VAT and Tax, the government revenue would grow many times more.
We must say big state-owned companies can’t play foul with tax-payers money depriving the state exchequer at the same time. They must create fund to pay the NBR but in no way there should be budgetary allocations for that or new tariff hike to be proposed to create fund to pay the arrears.
We know that to minimize losses, the utility providers have frequently hiked the tariff, almost every year and they realized more VAT accordingly. But failing to deposit the VAT to NBR despite such regular tariff hikes show big financial irregularities may be at work in other establishments as well. The management of public utility companies are systematically milking consumers to overcome losses but in many cases they use the money to hike their salary and allowances while keeping defaulter when it comes about paying the NBR. It appears that they were mindless to run into default. The question is why the management responsible for the default should not be punished because they are always pushing proposals to tariff hike to make their own fortune.
Reports said Petrobangla owes the highest amount of Tk 13,036 crore followed by Titas Gas Tk 1,973, Bakhrabad Gas Company Limited Tk 191 crore and Bangladesh Telecommunication Regulatory Commission (BTRC) Tk 279 crore to the NBR. It says Titas Gas did deposit VAT and SD collected from clients between April 2014 and December 2014. Bakhrabad did not pay from April 2014 to January 2015. VAT and SD at a rate of 15 percent are applicable to clients including industries, electricity, fertilizer, CNG, commercial and households. The gas distribution companies have collected the tax but Titas Gas deposited VAT collected from industries between April 2014 and December 2015, it did not depot the SD from industries and VAT and SD from other sectors. Bakhrabad Gas was guilty of the same.
Bangladesh has 8.5 lakh firms registered under VAT but only 32,000 submit tax returns and pay VAT to makes it clear that VAT is confined to a limited area. Data showed that 157 firms accounted for 55 percent of the total of Tk 56,080 crore collected as VAT and SD in fiscal 2015-16. It shows if all were paying VAT and Tax, the government revenue would grow many times more.
We must say big state-owned companies can’t play foul with tax-payers money depriving the state exchequer at the same time. They must create fund to pay the NBR but in no way there should be budgetary allocations for that or new tariff hike to be proposed to create fund to pay the arrears.
