Energy use becomes the parameter of endemic tax evasion

| Updated:
October 28, 2022 7:52:26 p.m.

Electricity consumption is now becoming a parameter of large-scale tax delinquency in Bangladesh, as nearly two-thirds of electricity consumers in the Dhaka Power Distribution Company (DPDC) find themselves without tax registration.

There are a total of 1,021,000 electricity users under the jurisdiction of the DPDC in the capital, Dhaka, and the neighboring region of Narayanganj. Among them, 365,000 have a TIN, a study by the National Board of Revenue (NBR) in the process of hunting down potential taxpayers revealed on Thursday.

It shows that only 35.74% of total electricity consumers who live in Dhaka South City Corporation and part of Narayanganj district have Tax Identification Number (TIN).

At a signing ceremony of a Memorandum of Understanding (MoU) between the NBR and the DPDC, NBR leaders hoped that the number of taxpayers would increase to 240,000 instantly through the exchange of information between the entities.

Currently, a total of 657,000 electricity consumers under DPDC do not comply with tax laws, although 605,000 have national ID cards, showed the slides presented by Niaz Morshed, second secretary at the DPDC wing. income tax from the tax office.

Speaking at the MoU signing ceremony at the NBR premises, NBR Chairman Abu Hena Md Rahmatul Muneem said that each of the household and car owners in the city should submit a tax return, whether or not he has taxable income.

“If someone has income below taxable income, they can easily show it on tax returns,” he added.

The NBR has partnered with the DPDC in an effort to make taxpayers compliant based on data and information on their wealth and income, he told the feature.

“No one would be able to deny if the taxman asks to pay taxes indicating wealth,” he added.

He said door-to-door survey is not a feasible method to find new taxpayers, but tax authorities can focus on policy formulation to come up with strategies to expand the tax net.

He appreciated the cooperation of DPDC with the BNR in the framework of the widening of the tax net so that the BNR can contribute more to the financing of the development works.

Pradyut Kumar Sarkar, Member (Tax Audit, Intelligence and Investigation) delivered a welcome speech during the program and appreciated the local innovation of NBR officials on digitizing the income tax wing.

DPDC chief executive Bikash Dewan said the company was able to deliver prompt services to consumers, but recently rationed its power due to government austerity policies.

Md Habibur Rahman, Secretary of the Energy Division, said that according to the Bangladesh Bureau of Statistics (BBS), some 3.5 million people are middle class and therefore able to pay taxes.

“It’s a universal tendency of people to avoid paying taxes. We’ve created an environment that makes tax evasion difficult for them,” he said.

Md Jahid Hassan, member of the NBR (tax information, management and services), said taxpayers will also benefit from the exchange of information as they will be able to show data on less energy consumption in case their rented house would remain vacant for two to three months. .

NBR system manager Ziaul Huq said the tax authority will be able to access electricity consumer data for up to 72 months as part of the integration through the interface.

Fazlur Rahman, system manager of the NBR, and Md Asaduzzaman, deputy secretary and general secretary of the DPDC, signed an agreement on behalf of their respective organizations.

BNR has already collaborated with Election Commission, Bangladesh Road Transport Authority, Bangladesh Financial Intelligence Unit (BFIU), National Board of Savings, Bangladesh Investment Development Authority, ‘Bangladesh Export Processing Zones Authority, Ministry of Finance Ibas (Software) etc. to hook new taxpayers on the net.

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