Monday, July 15, 2024

VAT rate to be cut by 2015: Muhith

Finance minister Abul Maal Abdul Muhith on Wednesday said value-added tax rate would be lowered significantly by 2015 to facilitate business expansion in the country.
‘I think the existing VAT rate at 15 per cent is little bit high and hope the rate will be lowered enough,’ he said at a programme on National VAT Day at the Bangabandhu International Conference Centre in the capital.
VAT is imposed on creation of wealth while income tax is collected on accumulation of wealth, Muhith said.
‘More tax on accumulation and less tax on creation of wealth will be the future taxation policy of the government,’ he said.
At the programme, businessmen demanded that the government should lower the VAT rate by maximum 10 per cent from the existing 15 per cent.
Muhith said that the government would also be able to establish a unique taxation system within the next 6 to 7 years wherein no injustice to the taxpayers would exist and taxpayers would pay tax voluntarily.
He also emphasised on increasing revenue collection for financing the country’s development activities and providing better services to the citizen.
‘Even a wicked government has to work for the betterment of the people. So it needs money that comes from revenue collection,’ the finance minister said adding that without raising revenue earnings the government would not be able to provide the people with essential services.
The National Board of Revenue organised the programme to observe National VAT Day for the third consecutive year aiming to create more awareness among the people and businesses.
The revenue board awarded 129 business organisations with crests and certificates in recognition of their paying highest VAT in the financial year 2011-2012.
A VAT Week organised by the tax administration also began on the day and will continue till July 16.
The revenue board awarded nine top VAT payers at the national level and 120 top VAT payers at the district level under three categories — production, services and business — to encourage taxpayers paying tax.
Among them, the highest VAT payers at the national level and 19 top VAT payers from the Dhaka Division awarded in Dhaka while the district VAT commissionerates awarded top VAT payers in their respective districts.
The NBR, however, withheld the highest VAT payer award for Runner Motors (Mymensingh) at production level and for De Costa Utilities Service (Gazipur) services level following an allegation of VAT evasion against them.
The NBR will finalise the decision of awarding these two business establishment after examining the allegation, an NBR official said.
Muhith said the government had made sufficient reforms in VAT system through enacting the new VAT act in 2012 which would go in full implementation in 2015.
‘After implementation of the law, no businesses will need to maintain any fake accounts. Everyone will have to maintain genuine accounts for VAT paying as the new VAT law will be ICT based ,’ he said.
At the meeting, Federation of Bangladesh Chambers of Commerce and Industry vice-president Md Helal Uddin urged the finance minister to take steps in lowering the bank interest rates for which the businessmen across the country were suffering much.
‘Businessmen want to pay VAT more but at the same time we demand maintaining the environment of doing business,’ he said.
NBR member M Firoz Shah Alam (VAT implementation and IT) presented the keynote paper at the programme chaired by NBR member (customs policy) Farid Uddin.
NBR members Hussain Ahmed, Nasir Uddin, VAT commissioner Lutfar Rahman and FBCCI director Abdul Haque, among others, spoke at the programme.
Earlier in the morning, the NBR brought out a colourful procession on the city streets starting from its premises in Dhaka.

-With New Age input

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