Economic Reporter :
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) on Saturday demanded an investigation into the “failure in widening the tax net by the NBR, although several hundred crore of taka was spent as consultancy fee for introducing the multiple VAT rate.”
National Board of Revenue (NBR) took a project involving more than Tk 600 crore for introducing the multiple VAT rates for businesses in 2012, , the country’s apex trade body said.
The objectives of the project were widening the tax net, easing the VAT system, improving compliance and reducing harassment of business owners, it added.
As per the consultation of the project, the government introduced the multiple VAT rates for businesses in 2017, but it was suspended for two years following protests in the business community.
The multiple VAT rates were finally applied in 2019.
However, the tax net did not improve and remained stagnant at 9 percent in the tax-GDP ratio, the collection system has not been eased and the incidents of harassment to the business community increased, said FBCCI President Sheikh Fazle Fahim at a virtual press briefing organized by FBCCI on Saturday.
Fahim said, “The officials and the consultants have not either able to ensure a combined and active vat system or not try to do it.”
“In fact, the incidents of harassment, especially to small businesses, by VAT officials have increased at the field level,” Fahim alleged at the press conference, where the organisation gave its formal remarks on the proposed budget for fiscal year 2020-2021.
The VAT system became more complicated, although the NBR spent a lot of money on consultants to ease the system, he claimed.
He demanded an investigation into how the amendments of the VAT system increased the harassment instead of easing of the system for businesses across the country.
Fahim said the implementation of new provisions in the VAT law will hurt small businesses as they are already weakened due to the Covid-19 pandemic.
“The proposed changes in the VAT Act are designed to address one per cent big businesses in the country, not the major smaller enterprises,” he added.
He said that if it has become too late to withdraw the proposed changes in the VAT law, then the National Board of Revenue (NBR) can amend it through a circular after the budget.
Fahim alleged that banks are showing reluctance to provide loans to cottage, small and medium enterprises under the government-announced stimulus packages.
The FBCCI president also said that the FBCCI will not recommend any willful loan defaulter for loans under the stimulus packages.
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) on Saturday demanded an investigation into the “failure in widening the tax net by the NBR, although several hundred crore of taka was spent as consultancy fee for introducing the multiple VAT rate.”
National Board of Revenue (NBR) took a project involving more than Tk 600 crore for introducing the multiple VAT rates for businesses in 2012, , the country’s apex trade body said.
The objectives of the project were widening the tax net, easing the VAT system, improving compliance and reducing harassment of business owners, it added.
As per the consultation of the project, the government introduced the multiple VAT rates for businesses in 2017, but it was suspended for two years following protests in the business community.
The multiple VAT rates were finally applied in 2019.
However, the tax net did not improve and remained stagnant at 9 percent in the tax-GDP ratio, the collection system has not been eased and the incidents of harassment to the business community increased, said FBCCI President Sheikh Fazle Fahim at a virtual press briefing organized by FBCCI on Saturday.
Fahim said, “The officials and the consultants have not either able to ensure a combined and active vat system or not try to do it.”
“In fact, the incidents of harassment, especially to small businesses, by VAT officials have increased at the field level,” Fahim alleged at the press conference, where the organisation gave its formal remarks on the proposed budget for fiscal year 2020-2021.
The VAT system became more complicated, although the NBR spent a lot of money on consultants to ease the system, he claimed.
He demanded an investigation into how the amendments of the VAT system increased the harassment instead of easing of the system for businesses across the country.
Fahim said the implementation of new provisions in the VAT law will hurt small businesses as they are already weakened due to the Covid-19 pandemic.
“The proposed changes in the VAT Act are designed to address one per cent big businesses in the country, not the major smaller enterprises,” he added.
He said that if it has become too late to withdraw the proposed changes in the VAT law, then the National Board of Revenue (NBR) can amend it through a circular after the budget.
Fahim alleged that banks are showing reluctance to provide loans to cottage, small and medium enterprises under the government-announced stimulus packages.
The FBCCI president also said that the FBCCI will not recommend any willful loan defaulter for loans under the stimulus packages.
