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Simplification of VAT system urged for better SME business regime
Dhaka Chamber of Commerce & Industry (DCCI) arranged a virtual workshop on “Finance Act 2020 and VAT & Supplementary Duty Act 2012” on November 14, 2020. About 100 memebers from DCCI and different business entities joined the workshop. Md. Alamgir Hossain (Tax Policy), NBR and Masud Sadik, Member (VAT Policy), NBR joined the workshop as special guests. DCCI President Shams Mahmud chaired the workshop.
DCCI President Shams Mahmud in his welcome address said due to Covid 19 disruption, the world-wide economy has experienced a shock. Considering this pandemic, the budget of 2020-21 aimed to re-build the disrupted economy. He also said that this year NBR revenue target is 3,30,000 crore taka which is 9.82% more than the revised budget of last fiscal. He emphasized on increasing tax-GDP ratio and investment-friendly simplified revenue structure to reach the goal of becoming developed nation. For that we need to increase tax net, online tax and VAT return submission system, simplification of return submission and hassle free service, he told. He also requested to exempt VAT on lease rent for the registered industries that are in operation in the economic zones. He also suggested to reduce rate of advance tax for the local SMEs who import raw materials. Shams Mahmud informed that like the previous years this year DCCI publishes its regular publication “DCCI Tax Guide 2020-21”.
Md. Alamgir Hossain, Member (Tax Policy), NBR said the government is trying to balance between the target of GDP growth and the challenge of Covid 19 situation. In comparison with other neighbouring countries our tax rate is not too high but it can be more rationalized, he said. He said, if NBR feels that reduction of particular tax may increase business activities, that will definitely be done. He expressed his hope that online VAT and tax return system will be completely implemented by the next year. In order to increase the tax net, the tax structure will be reformed soon, he informed. There are 1,76,000 business houses registered under RJSC among those 70-75 thousand are TIN holder but only 36,000 from them submit their returns, he told.
Masud Sadiq, Member (VAT Policy), NBR said we need to simplify VAT system to ensure ease of doing business. It is true that for country’s development, increased revenue target is a reality but at the same time we need to balance between the increased reveue target and rationalized tax regime, VAT structure.
M. Shafiqul Alam, FCS, FCA, Convenor, DCCI presented a paper on DCCI’s proposals on Budget 2020-21. He requested to ease VAT return submission process, refund of advance VAT system. He also suggested for a comprehensive online VAT return submission system.
Snehasish Barua, FCA, Tax Consultant, DCCI and Partner, Snehasish Mahmud & Co. presented another paper. He claimed for a simplified, easy, automated, sustainable and hassle free tax and VAT return submission system. He also said that a good number of initiatives of NBR are pro-business but different SROs in the middle of year sometimes hamper business activities. He also said that simplification of rules will reduce tax evasion.
Published on: 2020-11-14