NBR to launch drive to ensure flat, house owners file tax returns: Chairman

The National Board of Revenue (NBR) is set to launch a special drive targeting flat and house owners in metropolitan areas across the country, including the capital, to ensure they file their tax returns.

"We made it mandatory two years ago. Now it's time to take action. We have identified the house owners and will initiate the special drive very soon," NBR Chairman Abu Hena Md Rahmatul Muneem said during a pre-budget meeting at its headquarters in the capital yesterday.

"Those who own houses in Dhaka city and other metropolises have to file tax returns," he said, adding that those with taxable income will have to pay tax, but it is not applicable for others. However, filing tax returns is a must.

"Anyone who owns a house in Dhaka city should be able to file returns. That's why the government has enacted this law," he said, emphasising, "We have been attempting to persuade Dhaka and the metropolitan area for so long. However, we will no longer remain silent."

He said the return submission process has been simplified, and online return submission has been introduced as well. After implementing these measures, there is no logical reason for not filing returns.

Last year, the NBR made Proof of Submission of Return (PSR) mandatory for availing 43 services. Accordingly, in the case of renting a house, an organisation should verify the PSR of the owner of that house. Otherwise, they will have to pay a huge penalty along with additional tax.

Referring to this matter, Shahin Hasan, a representative of the e-Commerce Association of Bangladesh, said, "When we ask landlords to show PSR, they don't want to rent their house to us."

Another representative of the association said, "When we inquire with house owners about return submissions, they respond with counter-questions, asking, 'Who are you to ask? NBR will inquire about this.'"

"Perhaps they are unwilling to disclose their financial information to us," he added.

Jewellers association wants cut in VAT, duty on gold

At the discussion, the Bangladesh Jewellers' Association said higher tax incidence and weakened taka make gold jewellery in Bangladesh pricier at least by Tk8,000 per bhori (11.6gm) than in India, prompting people to spend heavily on ornaments made of the precious metal and resulting in money laundering.

A cut in Value-Added Tax (Vat), from 5% now to 3% alone, will generate at least Tk1000 crore more revenue from higher sales of local jewellery apart from protecting the age-old industry and checking currency flight, it said in its budget proposal placed to the NBR.

Inflation and a falling exchange rate have raised the price of a bhori of gold jewellery to Tk1,10,691 as of 24 January. The sales price finally reaches Tk1.19 lakh when Tk5,710 in VAT and Tk3,500 in making charges are added, it said, explaining how local gold jewellery becomes less competitive.

Similarly, if imports of gold ore are allowed at 1% duty instead of the 5% imposed now, the local refinery industry will be set up, and local jewellers will have access to pure gold from local sources at a cost-effective price, which will help check gold smuggling, as the association suggested in its budget proposal, signed by its President Sayem Sobhan Anvir.

Gold ore, partially refined gold, is now subject to 10% duty, and if it is lowered to 5% in the next budget, the local jewellery industry will get a further boost and offer pure gold ornaments at an affordable price to local consumers. It also wants that imports of concentrated ore, a gold waste used as raw material in the refinery, be allowed at 1% to encourage the local refinery industry.

"As gold jewellery in Bangladesh is costlier due to systemic reasons, people are discouraged from buying local jewellery and those from abroad. As a result, a huge amount of the dollar is going out of the country," reads the association's budget proposal.

It seeks an amendment to baggage rules barring travellers from bringing in gold bars and reducing the limit for them to bring home 50 grams of gold jewellery duty-free from 100 grams now. Gold bars worth Tk200 crore, funded by the hard-earned foreign currencies of expatriate Bangladeshis, are smuggled into the country through air, land, and waterways, the association estimates.

To encourage the diamond cutting industry and reduce foreign currency on diamond jewellery imports, the association suggested that customs duty on rough diamonds be slashed to 2% from 25% now.   

Tax incidence on gold ores, coins, and powder in Bangladesh is higher by 5%, 48%, and 27% than in India, the association said, citing how higher duties on raw materials and equipment hold back their potential to compete with foreign jewellery