The National Board of Revenue (NBR) plans to bring large taxpayers, especially the corporate houses, under its close inspection and supervision net to raise revenue collection.

The plan has been drawn up as the overall economic activities are picking up thanks to the utmost efforts of the government to salvage the economy from the Covid-19 pandemic fallout.  

The NBR has already instructed its VAT and income tax wings to review the overall revenue payment position of the Large Taxpayers Unit (LTU) to sort out a plan for boosting the revenue collection during the remaining six months (from January to June) of the current fiscal year 2020-21, sources said.

The LTU contributes 65 per cent of the NBR's total VAT collection. There are as many as 170 large companies under the unit. The government has set a target to collect Tk 700 billion for LTU VAT, expecting a 63 per cent growth for the current FY21 compared to that of the last FY.

Sources said the NBR is now under pressure from the finance ministry to achieve revenue collection target for FY21 to meet the growing expenditures of the government especially for the mega projects like the Padma Bridge, metro rail and expressway.

"We have no alternative but to expedite the drive to boost revenue collection in the next six months of the FY21.The VAT wing has been asked to bring the large taxpayers under its close scanning to boost revenue collection," said  NBR member (VAT policy) Abdul Mannan Shikder.

As the NBR gets the major chunk of its revenue from the large taxpayers, the LTU unit has been instructed to beef up inspection to check any attempt of tax dodging, he said.But at the same time officials have been instructed to be more cautious so that none is harassed during tax collection, he added.

Sources said that in August last, large taxpayers apprised the Large Taxpayers Unit (LTU) under the National Board of Revenue (NBR) of the dismal business activities due to the COVID-19 pandemic since March.

They apprehended a sharp slide or poor growth in their sale and probable payment of consumption tax in FY21 as the ongoing Covid pandemic has taken a heavy toll on all types of economic activities, and it may continue to affect the internal revenue collection.

Abdul Mannan Shikder added that the NBR is  aware of the business setback due to the Covid-19 pandemic but the situation has improved significantly over the last few months and the NBR would not create illogical pressure on anyone for revenue collection.     

According to the NBR, large taxpayers include British American Tobacco, Grameenphone, Met Life, Square Pharmaceuticals and private commercial banks such as Islami Bank Bangladesh Ltd., Standard Chartered Bank, BRAC Bank, Dutch Bangla Bank, National Bank Limited, and Southeast Bank etc.

Among the sectors, revenue from tobacco contributes majority of the LTU's earning. There might be eight to 10 per cent drop in sale of cigarettes in current FY, industry insiders said.

The situation slightly improved in the months of November and December. But, British American Tobacco, Bangladesh (BATB), which pays the highest amount of VAT, has projected only 1.0 per cent growth in the current FY over the corresponding year, said a senior VAT official.

Although tax revenue collection started gaining momentum gradually after the Covid-19 pandemic fallout, posting 2.10 per cent growth in the first half (H1) of the current fiscal year (FY), 2020-21, NBR is still lagging behind the target.  

The NBR has a collection target of Tk 1, 41, 000 crore during the first six months of the fiscal year but there is a collection shortfall of Tk 32754 crore.

In December 2020, the NBR collected Tk 21377 crore revenue against its target of Tk 28265 crore.

However, tax collection declined by 2.11 per cent in the month compared to that of the same month in the previous year.

According to the NBR data, income tax collection grew by 6.33 per cent and import duties by 8.61 per cent in December.

The revenue collection target for the next fiscal year 2020-21was set Tk378,000 crore.