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INCOME TAX THRU SELF ASSESSMENT

Audits find Tk 3,024cr dodged in 2 yrs, NBR collects Tk 150cr

Jasim Uddin

A file photo shows two people calculate income tax through self assessment system at a tax fair in Dhaka. — New Age photoA file photo shows two people calculate income tax through self assessment system at a tax fair in Dhaka. — New Age photo

The National Board of Revenue till November last year collected Tk 150 crore out of the Tk 3,024 crore in income taxes which were dodged by taxpayers in 2010-11 and 2011-12 fiscal years and later detected by the revenue board through field audits.
NBR officials said the revenue board failed to collect almost 95 per cent of the amount as most of the taxpayers submitted appeals to the appellate tribunal of the NBR and went to court against the revenue board’s decision.
According to the latest data, field offices of the NBR audited tax files of 21,749 taxpayers for the two fiscal years and found that Tk 3,024 crore was evaded by the taxpayers, mostly by the corporate taxpayers.
In the two fiscal years, 2,166 corporate taxpayers evaded Tk 2,703 crore, which is around 90 per cent of total taxes dodged, the data showed.
Of the evaded taxes which remain unrealised till November, contribution of corporate taxpayers is Tk 2,598 crore.
NBR officials said the selection of files and other procedures for conducting audit of tax files of FY 2012-2013 were now in progress.
Field offices of the revenue board conduct thorough investigation of the tax files selected for audits to find if taxpayers have evaded tax or not, they said.
The NBR usually selects 2 per cent to 3 per cent of tax files from the files submitted under the universal self assessment method for auditing, considering risks of tax evasion.
The revenue board calculates tax evasion risks  following some specific criteria including showing illogical losses in business despite having record income previously, abnormal decline in income compared to that of the previous year, no logical explanation on increase of wealth, unacceptable tax-exempted income, unacceptable donation, non-institutional loan without any evidence and legal loopholes.
According to the data, the NBR gave approval to its field offices for auditing 16,911 tax files or 2.45 per cent of income tax returns filed under universal self assessment method in the FY 2011-2012.
Till November 13 last year, field offices of the NBR disposed 11,655 tax files and found Tk 868 crore was dodged, mostly by the corporate taxpayers.
In the period, it collected only Tk 38.55 crore out of the dodged amount, the data showed.
The audit of the remaining 5,256 tax files is going on, NBR officials said.
For the FY 2010-2011, field offices completed audit of 10,094 tax files out of the tax files submitted under universal self assessment method and found that taxpayers evaded Tk 2,156 crore in income tax.
In the fiscal year, 1,066 corporate taxpayers evaded Tk 1,957 crore while 9,028 individual taxpayers dodged Tk 199 crore.
Till November 13 last year, the NBR managed to collect Tk 111 crore out of the amount dodged in the fiscal year, the data showed.
‘As taxpayers submit their returns under universal self assessment system, they [taxpayers] firstly deny the NBR claim and then go to court. So huge amount of taxes dodged remain unrealised,’ a high NBR official told New Age on Saturday.
Sometimes, claims made by
tax officials do not stand in court, he said.
Under the universal self assessment system which is introduced in FY 2007-08 taxpayers calculate their own tax and submit income tax returns.
Initially, taxpayers were exempted from auditing if they showed 20 per cent increase in their income, but later the NBR found that taxpayers were evading tax using the facility.




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