Vat Collection
NBR to intensify surveillance on company purchase
The National Board of Revenue is going to intensify its surveillance on procurement of public and private limited companies to ensure collection of value added tax on their purchases, officials of the NBR said. The revenue board has already asked its field offices to prepare separate lists of limited companies under their jurisdiction and examine if they deduct VAT on payment of procurement bills to suppliers, they said.
They have also been asked to collect detailed information of companies’ procurement done in last few years, officials said.
They said limited companies purchase different types of products in huge quantity from local markets for different purposes every year and according to the VAT Act-1991 government, semi-government and autonomous bodies and companies were supposed to deduct VAT at source at the rate of 4 per cent while making payment to suppliers for purchasing goods.
The money, after collection from suppliers, is supposed to be deposited to the government exchequer by the procuring entities.
But the companies hardly pay such VAT taking advantage of lax monitoring by the tax authorities because of lack of sufficient manpower, they said.
The government bodies, however, deposit the deducted VAT regularly as there is no scope to dodge, they said.
‘We are not sure whether the companies deduct such VAT on payment to the suppliers for purchasing goods or they do not deposit the deducted VAT to the government exchequer. So the NBR has decided to boost monitoring on companies’ procurement to ensure collection of such VAT,’ a VAT wing official of the NBR told New Age on Wednesday.
He said that although the NBR introduced VAT on procurement a few years ago, it could not enforce it due to manpower shortage.
Now the revenue board is going to enforce the rules based on accurate information. That is why the NBR asked its field offices to prepare the companies’ lists and check their records of VAT payment against procurement, he said.
According to the data, the NBR collected Tk 34,572.63 crore as VAT in the fiscal year 2011-12 and Tk 28,023.98 crore in FY 2010-11.
Out of the amount, the NBR got Tk 6,353.22 crore and Tk 5,904 crore respectively as VAT at source.
In last few years, construction firms, mobile phone operators, advance trade VAT, commercial importers, suppliers and leasing service providers remain at the top of the list of VAT payers at source.
VAT on procurement falls under suppliers’ category, NBR officials said.
According to the NBR data, NBR received Tk 561 crore as tax in FY 2011-12 and Tk 261 crore from as VAT on procurement.
Officials said that most of the collected VAT on procurement came from government bodies.
-With New Age input
