The National Board of Revenue (NBR) has been advised by the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) to desist from coercing or intimidating companies into paying taxes, especially those who have suffered financial losses as a result of the recent student movement and current flooding.
The request was made on Sunday during a meeting between newly appointed NBR Chairman Abdur Rahman Khan and the nation’s top trade body.
Leading by its President, Md. Mahbubur Rahman, the FBCCI also requested the NBR to base tax collection on business income as opposed to turnover, or yearly sales, stressing that turnover-based taxation forces companies to pay more taxes even in the face of losses or poor earnings.
The trade body further addressed issues of harassment by customs officials and presented several demands to resolve these concerns.
Munir Hossain, vice president of FBCCI, who was also present at the meeting, said, “During July and August, the recent student-led movement, which later turned into a mass revolution, caused most businesses across the country to incur losses. Moreover, the ongoing flood situation in some districts further disrupted the supply chain, which has had a serious negative impact on business.”
“In this challenging situation, we requested the NBR to approach tax and value-added tax (VAT) matters with leniency. Businesses that have incurred losses or made less profit should not be overburdened with VAT and taxes.
“We raised this issue with the NBR chairman to ensure that businesses are not subjected to harassment,” he added.
“The tax department is currently collecting taxes based on turnover. However, tax collection should be based on actual income or profit, as turnover tax is not an ideal system. We urged the NBR to consider these concerns,” he said.
A senior NBR official who attended the meeting, speaking on condition of anonymity, also confirmed the local media about the business leaders’ requests to scrap the turnover tax system.
“Considering the losses incurred by businesses due to recent events [protests] and ongoing floods, the NBR chairman has viewed the request positively,” he said.
FBCCI President Mahbubul Alam, at the meeting, noted that harassment by customs officials in various customs houses has increased in recent times.
Hinting at dishonest officials, he said, “The NBR needs to identify those officials and hold them accountable, as their actions are leading to the misuse of rules and regulations.”
In response, the chairman of the NBR urged corporate executives to offer precise details regarding dishonest staff as opposed to levelling broad charges. He also exhorted companies to conduct themselves honourably.
The NBR chairman further announced plans to automate the tax audit process to reduce human involvement and prevent potential misuse.
