The government on Monday withdrew special tax benefits on income of fish farms following the controversy surrounding wide-spread irregularities in availing the facility.
The National Board of Revenue imposed tax at regular rate of 35 per cent on fish farms under company category scrapping the provision of only 3 per cent tax on their total income.
For a fish farm against any individual’s name, the owner has to pay 10 per cent to maximum 30 per cent tax on their income from the farms.
The 3 per cent special tax rate was scheduled to expire on June 30, 2015.
The NBR issued a statutory regulatory order Monday, signed by secretary (ex-officio) Syed Md Aminul Karim, withdrawing the reduced tax benefit.
Most of the non-listed private companies in the country pay 35 per cent income tax.
A NBR official told New Age that the government high-ups noticed a significant amount of revenue loss because of the abuse of the tax benefit for fish farms.
‘Many business people shifted their profits from another business to fish farming to enjoy the reduced tax rate. The taxmen found a large amount of tax evasion through the practice,’ he said.The ‘fish farming’ by some of the influential politicians, who tried to conceal their taxable income, came to light during the general elections in January this year.
The NBR also found some complexities in monitoring the income and actual payable taxes of the fish farm owners, said the official.
‘We have found many of the fish farms disappeared after enjoying the reduced tax rates. They have shown false income from fish farms that they earned from other businesses,’ he added.
He said that as tax officials assessed income of taxpayers until June 30 of a financial year, for which taxpayers submit returns in October to December it takes almost six months time to complete procedures and decide on inspection for monitoring tax compliances of a company.
He, however, said the withdrawal of the special tax facility would not affect small fish farmers as they would enjoy other tax benefits as agriculture farmers.
‘The NBR imposed the regular tax rates targeting to the large businesses and also to plug holes of revenue leakages,’ he added.
However, poultry farming, cattle farming, dairy farming, frog farming, horticulture, mushroom farming, floriculture, pelleted poultry and fish feed industry would continue to enjoy the reduced tax benefit until June 30, 2015.
-With New Age input
