Polls in 125 UPs underway
March 31, 2011
Voting is taking place in 125 unions on Thursday, the third day of the first phase elections in the lowest tier of the local government body.
Japan’s atomic plant neighbours mull leaving homes
March 31, 2011
he nightmare of Japan’s unfolding nuclear emergency is sending fear through the community that lives in the shadow of another coastal reactor.
Current labour law ‘not favourable for workers’
March 31, 2011
Speakers at a workshop Wednesday said the existing labour law is not consistent with the expectations of the workers rather in many cases it upholds the interest of the owners.
Khaleda to perform Umrah today
March 31, 2011
BNP Chairperson Khaleda Zia, who is now in Saudi Arabia, will perform holy Umrah early today (Thursday), reports UNB.
Jute bag use could up cement prices
March 31, 2011
Cement manufacturers have opposed the provision of mandatory use of jute bags, saying the legal obligation could hike prices of the key construction material.
Gas rationing and industrialisation
March 31, 2011
Gas rationing has begun throughout the country this week. As part of it, a good number of fertiliser factories will have to be closed to make way for diverting gas to some gas-fired power plants. The gas to be saved, to the tune of 250 million cubic feet per day (mmcfd), will be used to produce more electricity to ensure unhindered irrigation during the current Boro season.
Tax evasion in FY ‘10 Tk 210b: TIB study
March 31, 2011
An amount of Tk 210 billion in taxes were “evaded” or “defalcated” in fiscal 2009-10 which was 2.8 per cent of the country’s national income and one-third of tax revenues collected during the year, Transparency International, Bangladesh (TIB) said Wednesday.
The TIB, in its research findings noted, the National Board of Revenue (NBR) could have collected 34 per cent more revenues than what it did in fiscal 2009-10 if it realised the above-noted ‘tax-evaded’ or ‘defalcated’ amount of money.
The TIB study also identified that tax-gross domestic product (GDP) ratio increased by only 6.5 per cent in the last 35 years as the government gave less priority to increasing tax revenue-collections.
It recommended to the NBR to ensure efficiency, transparency and accountability in the revenue board to help boost tax collection.
The TIB listed a set of recommendations and unveiled key findings of its study on tax collections by NBR in a roundtable, at city’s CIRDAP auditorium.
The findings of the research titled, “The National Board of Revenue: Challenges in transparency and accountability and its way out”, were presented at the roundtable.
Former advisers to the caretaker government Mirza Azizul Islam and Akbar Ali Khan, former NBR chairman Badiur Rahman, NBR members Aminur Rahman and Farid Uddin attended the roundtable.
TIB researchers M Zakir Hussain and Nina Samsunnahar conducted the study on a sampling method. The research team collected data from 713 people and 50 businessmen.
TIB trustee board chairman M Hafizuddin Khan chaired the roundtable discussion.
The team conducted the research from April 2007 to February 2011.
TIB said existing tax structure puts much pressure on low income people due to high rates of indirect tax.
In the study report, the TIB identified tax evasion as a major reason for the country’s poor tax-GDP ratio.
Referring to the 2010 national household survey, the TIB report said 62 percent of the taxpayers identification number (TIN)-holders faced harassment and corruption at the time of tax assessment and registration.
The TIB said taxpayers have to spend Tk 3500 on an average for bribing the tax officials for tax assessment and faced harassment on getting tax rebate.
Around 72 per cent of the imported consignments involve payment of bribe for obtaining their clearance from the port.
The TIB study also identified concealment of information by customs officials on numbers and the nature of cargoes, false statements on country-of-origin and underinvoicing, by bribing tax officials.
The report also focused on roadblocks of the NBR to expediting efforts for increasing revenue growth.
“The NBR failed to appoint any officials in 1984 to 2009 period although revenue collection increased 10 times in 1990-2010,” the report said.
On an average, a VAT inspector has to maintain 10,000 records of businesses while a deputy commissioner of taxes (DCT) has to check 15,000 files annually.
The report also identified irregularities in approval of incentives and rewards.
It recommended to the government to fix the tenure or NBR chairman for, at least, three years.
The TIB study identified several reasons for tax avoidance by potential taxpayers.
The reasons included, among others, lack of confidence in government machining about making proper use of the collected amount of taxes, poor public services in areas of citizens’ benefits falling much short of people’s expectations, complicated tax collection system, underhand dealings between taxpayers and taxmen, non-enforcement of measures relating to appropriate punishment for tax evasion, introduction of automation and e-governance at a snail’s space, and non-coordination between different departments of NBR.
The TIB estimated that an amount of Tk 90.00 billion in black money was whitened between 1976 and 2006. The scheme for whitening black many neither helped the NBR to collect higher amount of revenues nor was morally acceptable, it noted.
The TIB recommended for withdrawal of this scheme, while calling for mandatory provision for all financial transactions being routed through banking channel and public disclosure of wealth statements of the policymakers.
For resolving complexities in tax appeal process, the TIB report suggested for appointment of judges, income tax lawyers and Chartered Accountants as members of appellate tribunals.
The TIB report strongly criticised the repeal of the Tax Ombudsman’s Act, without making any efforts for reforming its office. The move will fuel corruption and irregularities in tax administration, it feared.
The TIB study also strongly pleaded for full automation of tax collection system and facilitating e-governance.
The TIB research team has collected data from salaried persons, individuals and corporate bodies, professionals, food shops, small and medium enterprises (SMEs) and clearing and forwarding agents.
The National Board of Revenue (NBR), however, disagreed with the findings of TIB, saying that the research has highlighted systemic problems only and its recommendation would hardly bring any positive impact on reforming the revenue board.
The board also opposed the method of estimates about Tk 210 billion as being the amount of tax evasion or defalcation in fiscal 2009-10 tax evasion.
“I have doubts about the amount. The TIB hasn’t clarified whether it is tax gap that could be collected from potential taxpayers or tax evasion,” said NBR member (customs and VAT administration) Farid Uddin.
He, however, admitted that there were distortions in the tax system and also lack of skill and capacities of taxmen. He said the existing VAT law is nothing but an ‘excise law’ caused by distortion.
The NBR members made these comments at a roundtable, centring the unveiling of a research by TIB report on NBR.
“Still, the country is collecting 39 per cent revenue at the customs points. But manpower strength is very poor there. The NBR has appointed PSI (pre-shipment inspection) companies for this reason, but they have failed to perform well,” the NBR member said.
The NBR could not appoint officials for the last 26 years due to different court cases, he added.
The current requirement of manpower is 4000 at the customs points, but there are only 1200 officials working there, he said venting his frustration also on their educational qualification and age.
“Most of the officials promoted from the field-level positions are under-graduates or aged over 55,” he said.
The NBR needs educated and young officials to help boost revenue collection, he added.
“We have overcome the roadblocks in recruitment. Within a few months, the board will be able to recruit 600 officials,” he said.
The NBR member said the revenue board has moved to digitise all of its services to resolve the existing allegations about people’s harassment.
NBR member (income tax policy) Aminur Rahman said: “Other countries calculate provincial tax along with central tax revenue, but we do not follow this. It could be a reason for poor tax-GDP ratio of the country.”
He said the NBR has been forced to allow tax exemptions on different grounds including reining in of prices of essential food items.
Suranjit urges BNP to join spl JS body
March 31, 2011
Co-chairman of the Special Parliamentary Committee for Constitutional Amendment Suranjit Sengupta Wednesday reiterated his call to the main opposition BNP to join the committee and contribute their prudent opinion and suggestions to have the best constitution for the nation, reports BSS.
Procurement issue impedes use of $1.0b Indian credit
March 31, 2011
Bangladesh is in a dilemma in implementing projects, using US$1.0 billion Indian credit. As a result, the government has sent project details to the lender for getting clarification on emerging differences about procurement.
Libya’s foreign minister defects, arrives in Britain
March 31, 2011
Libyan Foreign Minister Moussa Koussa, one of Muammar Gaddafi’s closest advisers and a former spy chief, defected and flew to Britain on Wednesday in protest at attacks by Gaddafi forces on civilians, a friend said.