Photo : Messenger
The National Board of Revenue (NBR) is gearing up to take stringent measures against individuals and organisations that have neglected to file their returns despite possessing Tax Identification Numbers (TINs). Concurrently, efforts are underway to broaden the tax base by including new taxpayers, aiming to bolster revenue generation. This initiative comes in response to a revenue shortfall compared to the set targets.
According to NBR sources, the tally of TIN holders reached a significant milestone, crossing the one crore mark this February. A decade ago, in 2013, the number of TIN holders stood at a mere 16 lakh in the country.
This indicates a remarkable surge, with the number of TIN holders increasing over sixfold in the span of a decade. Notably, among these are approximately one and a half lakh companies and firms. However, despite this surge, around two-thirds of TIN holders have yet to file their returns or disclose their financial transactions to the government. The statistics show that around 36 lakh individuals and entities have submitted the Tax return.
The deadline for filing annual returns for individual taxpayers was set for January 31. This year, an additional two-month grace period was granted for submission, yet a substantial number of taxpayers failed to meet the deadline. While late filings are still permissible, individuals will forfeit any tax concessions and incur penalties for non-compliance.
A senior NBR official, speaking on condition of anonymity to The Daily Messenger, emphasised that many individuals have obtained TIN numbers due to governmental mandates for various transactions but have failed to maintain regular filing practices. It's worth noting that a significant portion of these TIN holders may not have taxable incomes.
The NBR official further emphasised, “However, NBR has received intelligence from various sources indicating that numerous individuals and institutions have neglected to file returns despite having taxable income. Action will be taken against all such individuals and institutions by categorising them accordingly. The process has already commenced. Initially, they will be notified via letter, and if returns are not filed, legal measures will be pursued.”
According to NBR data, the revenue deficit in the first six months (July-December) of the current financial year amounted to Tk 23,227.19 crore. In December alone, the deficit stood at Tk 6,782.21 crore. Notably, the fiscal deficit for July-November was Tk 16,459 crore, indicating an increase of Tk 6,768 crore in just one month.
During this period, the revenue deficit in import and export operations reached Tk 8,563.47 crore, while there was a shortfall of Tk 6,070.74 crore in value-added tax (VAT) collection. Additionally, the deficit in the income tax sector amounted to Tk 8,592.98 crore.
Muhamad Abdul Mazid, former Chairman of NBR, expressed his views to The Daily Messenger, stating, “The government or NBR has not historically enforced strict measures against individuals who fail to submit their returns despite possessing TINs. Consequently, while the number of TIN holders continues to rise, the number of return filers has not increased proportionally.
He further added, “The government consistently raises the revenue collection target for NBR in the annual budget. In striving to meet these targets, NBR increases taxes and VAT on various goods and services, adding to the burden on the general populace. If all taxable individuals are brought under the tax net and taxes are collected promptly, it will alleviate pressure on NBR and yield benefits for both the government and consumers.”
It's worth noting that the revenue collection target for the current financial year has been set at Tk 4,30,000 crore. However, in the first six months, the government's revenue collection fell short of the target, with only Tk 1,65,629.75 crore collected against the expected Tk 1,88,756 crore. This indicates a shortfall of Tk 23,227 crore in the initial half of the fiscal year.
Meanwhile, almost every year there is a major discrepancy in revenue collection as per NBR’s accounts and CGA’s. There are also differences in different departments. The government has taken initiatives to eliminate this discrepancy. All transactions of the Income Tax Department of NBR are now through A-Challan (automated challan), but some transactions are done manually in Customs-VAT.
However, very soon all customs and VAT transactions will be brought under A-Challan. This decision was taken in the Cash and Debt Management Committee (CDMC) meeting of the Finance Department.
It may be noted that CGA’s account and NBR’s account are different, as not all revenue transactions are done through A-Challan. Again, in some cases, the accounts of the Ministry of Finance are different. This has created a kind of confusion in the government accounting information.
Recently, the data of EPB and Bangladesh Bank has also been found to be inconsistent. The government has taken initiatives to remove these confusions. Besides, it has been decided to shift the revenue collection process from e-payment to A-Challan. NBR will implement the decision.
Messenger/Fameema
