SAM

Published:
2020-02-09 17:34:31 BdST

VAT project implementationWB could pull out funds, partially


FT ONLINE

The World Bank is unlikely to release the remaining 40 percent of the NBR's struggling online VAT project.

Of the $60 million pledged fund, the multilateral lending agency has so far provided $36 million for the project.

Officials have expressed the fear that the National Board of Revenue, or NBR, may not get the remaining fund within the project's tenure.

The project, which was launched in May 2014, is scheduled to conclude on June 30, 2020.

People familiar with the development said the fund disbursement for the project largely depends on its outcome.

The achievement of online VAT registration is 75 percent while online return submission is 37 percent, according to a recent monitoring and evaluation report of the bank.

Under the project, the government has developed online VAT registration, known as Business Identification Number, or BIN, and online VAT return submission modules.

But modules for some other major areas, including refund, risk management and audit remained unimplemented.

Under its routine work, the bank has so far conducted six reviews and the seventh one is going on.

Former project director, now Director-General of the VAT intelligence team, said they are expecting to get around $8.0 million in additional funds from the bank within the project tenure.

The VAT authority would receive the fund if it could ensure online return submission by all large taxpayers under the Large Taxpayers' Unit.

While the project is scheduled to expire by December 2020, the remaining modules of the VOP might be completed under the new project titled 'Medium-term revenue strategy, he said.

In a recent meeting, the project sought cooperation from the bank's auditor Deloitte to finalise six business processes.

The business processes include audit enforcement, refund credit adjustment, risk-based audit case detection, enforcement for non-filing, document management and certification.

But officials remained defensive and shifted the blame on to FPT, the Vietnamese consultancy.

They alleged the FPT officials said are now sitting almost idle and some went back to Vietnam as the revenue board declined to pay the company anymore.

The NBR has provided Tk 1.12 billion to FPT out of its contract for Tk 2.30 billion.

The slow trend in automation has left adverse impact on revenue collection from VAT at the local stage.

During July-December period of the current fiscal year, VAT collected from domestic sources faced a Tk 109.05 billion shortfall against the target.

The new VAT and Supplementary Duty Act-2012, which came into force since July 2019, is a fully online-based law.

Officials said VAT evasion by businesses has gone up significantly due to the absence of the automated system.

Some field-level officials said they are facing difficulties in implementing the provisions of the new law for this reason.

The objective of the project is to integrate 287 VAT circle offices, 84 divisional offices, 12 commisionarates, two directorates, three appeal commissinarates, and a tribunal into a single platform.

The integration of Bangladesh Bank, Comptroller and Auditors General's Office and income tax department is also under the purview of the project.

Unauthorized use or reproduction of The Finance Today content for commercial purposes is strictly prohibited.


Popular Article from Economy