Biman Bangladesh Airlines has sought exemption to the National Board of Revenue from paying minimum income tax for ensuring existence of the state-owned company in stiff international competition, Biman officials said. They said that Biman sought the exemption as a support from the revenue board for its survival as the national flag carrier already became burdened with huge amount of loans from national and international sources and it had to spend huge amount of principals and interest against the loans every year.
Officials of the NBR said that they were yet to take any decision with regard to Biman’s plea for tax exemption.
Till now, there have been no examples of exempting minimum tax. The NBR will have to issue a Statutory Regulatory Order if it wants to provide such exemption to Biman, they said.
In a recent letter to the revenue board, Biman’s managing director Kevin John Steele advocated that foreign currency earners national flag carrier should get the exemption from paying 0.50 per cent minimum tax on its gross receipts.
The business type of Biman is quite different from other local manufacturing and business entities. So the minimum tax should not be levied on Biman’s gross income, Kevin said.
According to article 16CCC of the Income Tax Ordinance-1984, every company operating business in Bangladesh, irrespective of its profits or loss, has to pay minimum tax at the rate of 0.50 per cent of gross receipts from all sources.
Kevin, also chief executive officer of Biman, said that currently Biman was operating its business in 25 countries through its own offices, travel agents and general sales agents across the world.
In the fiscal year of 2012-13, the gross income of the company was Tk 3,959 crore including income derived from foreign sources, he said, adding that they do not prepare separate accounts for its foreign income.
In the FY 2012-13, Biman paid a total of Tk 212.63 crore as taxes including employee income tax, tax at source and VAT despite the company incurred a loss of Tk 191.59 crore and its aggravated loss in last six years stood to Tk 1,019.47 crore.
He also said that Biman had to spend Tk 2,126 crore in that fiscal year for operating its business.
The firm is also facing severe liquidity crisis, he said.
The company, however, did not get any facilities from the revenue board, he alleged.
The state-owned company had taken Tk 1,467.94 crore loan from national and international sources for buying Boeing aircraft as a part of its plan to be profitable soon.
Biman has to repay huge amount of money as principals and loans to lenders that has increased the liquidity crisis of the organistion, Kevin said.
Biman also plays an important role in carrying passengers and goods with minimum or no cost in the time of emergency including helpless expatriates, relief goods, Hajj pilgrims and perishable goods.
In these circumstances, it would be logical to keep the Biman out of the purview of minimum tax, he argued.
-With New Age input
