Automated Challan System gaining galore among taxpayers

On 31 May 2021, Bangladesh Bank allowed all scheduled banks working in Bangladesh to collect the Government revenues and fees by using The Automated Challan System (ACS). 

Under the system, any individual citizen or company would be able to deposit the money of treasury challans at any branch of all commercial banks throughout the country. 

Besides, the clients will also be able to deposit the money of treasury challans through online banking, internet banking, mobile financial system, cash, cheques, debit and credit card, and account debit on a real-time basis. 

In case of depositing money through cash, online banking, banking apps or mobile financial system, the clients will get copies of their challans immediately. 

ACS, a web-based software of the Finance Ministry for generating Government challan, has been gaining popularity among the beneficiaries. 

It is an integrated online platform of the Bangladesh Government to collect the revenues, fees and various service charges from individual citizens and different organisations through banking channels. 

The National Board of Revenue (NBR) has introduced this system to facilitate the collection of some 645 types of Government revenues and fees on a real-time basis. 

The Finance Division of the Finance Ministry has developed ACS to improve public financial services delivery through the implementation of budget and accounting classification and iBAS++ scheme, a component of the strengthening public financial management programme to enable service delivery.

Major services of ACS include payment of Income Tax (Company and Individuals), VAT, customs and excise duties, passport fees, visa and NID fees, land registrations fees, environmental certificate fees, transport registration and vehicles fees, utility bills of all government employees, health, defence and public administration fees, and deposition of fees of all government Institutions.

Previously, Bangladesh Bank and Sonali Bank, as agents, were solely authorised to collect the Government revenues through the conventional treasury challan system. 

The clients had to deposit money to the government fund in cash over the counter in a long queue bearing untold sufferings. Sometimes, the challan went missing in the manual system creating a mismatch with banks and the national exchequer.       

The ACS is more efficient and transparent. The clients will get slips subject to the clearance of their cheques for depositing money through cheques. 

They will also get text messages on their mobile phones at every tier of issuance of cheques and challans. The client can verify the authenticity of the challan on the website of the Ministry of Finance immediately after generating the same. 

Regarding the deposition of money through online banking or mobile financial system, the amount will directly be deposited to the state coffer through Real Time Gross Settlement (RTGS) of the Bangladesh Bank. 

So the settlement process between Bangladesh Bank and NBR will be completed daily and the government will be benefitted.  

Some forty commercial banks are now collecting the government revenues through ACS. Service-providing banks will earn a 0.10% commission from the amount collected through ACS, which has created an avenue for gaining huge amounts of service income. 

The commercial banks are now competing among themselves to capture the markets by providing personalised and value-added services and other banks are in the pipeline to enter into this service. 

Until 26 October 2021, some 43 banks including four state-owned ones have been providing ACS and collected revenues worth Tk5,823 crore through 1,03,77,55 instruments of Government challan. 

To provide the services, the banks have to get registered with the Ministry of Finance and have user ID and passwords, namely checkers and makers who will be responsible for any fraudulent activities in this connection. 

Before this process, the respective banks are to sign an agreement with Bangladesh Bank for conducting the services.    

If ACS is implemented on a full scale, then it may be possible to bring in epoch-making progress in the revenue management of the government. 

It will also ensure transparency and accountability in the revenue deposition system, check deposition of fake challans and quicken the whole challan procedures. 

The government's treasury challan process will be easier and customer-friendly and avert the tax evasion tendency of the common people. 

Md. Khairul Hasan Munna is a banker and freelancer; can be reached at hasan.khairul@gmail.com 

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.