The National Board of Revenue (NBR) wants to increase the number of taxpayers to at least 10 million from the existing number of 2.2 million in line with the next fiscal budgetary plan.
At present, 5 million people have TIN (Tax Identification Number) in the country -- of which 2.2 million submitted their tax return in the fiscal year2019-20.From the next fiscal year, submission of tax return will be mandatory for whoever has TIN, NBR sources said.
Taxpayers or TIN-holders who are currently only able to pay taxes are required to submit an annual tax return.
All those who have TIN in the proposed budget will have to submit a return. In addition, it is proposed to impose new taxes on commissions on bond trading in the stock market and to reduce the tax rebate facility for company expenses.
Sources said the government wants to bring more people under the tax net. For this reason, the tax rate has been reduced in this year's budget for both individuals and companies.
NBR Chairman Abu Hena Rahmatul Munim said the tax rate in Bangladesh is comparatively higher than other countries in the world.
That is why the tendency of tax evasion is also high. As a result, the able persons are not being encouraged to pay taxes. We will gradually reduce the tax rate and increase the coverage.The NBR official told the daily sun that action would be taken against those who did not submit their returns in the future.
If necessary, the bank accounts of the suspects will be searched. The number of individual taxpayers in the country is very low in proportion to the population. A large portion of the able-bodied is still out of the tax net.
From the next budget, stock market is taxed 0.5 percent on the commission taken per share traded in the brokerage house in the secondary market.
In the proposed budget, the previous rules have been kept unchanged and new bond transactions have also been brought under the tax.
It has been said if bonds and mutual funds are listed on the stock market the commission will be taxed at the rate of 10 percent.
There are currently five, ten and twenty year bonds in the market. Ordinary big companies buy bonds.
At present, institutions pay advance tax at the time of purchase of bonds and withholding tax on the transaction price.
In the next budget, it has been proposed to repeal the previous provision and impose 10 percent tax against the commission that will be earned by trading bonds.
An NBR official said this would increase bond transactions in the capital market and develop the country's bond market.
Tax incentives are given in the budget at different times to encourage business. The benefits are given so that the organisation can continue its business activities and make profit.
The current law provides tax benefits for company expenses in the 'promotional expenses' sector. Suppose an organisation transacts Tk 1 billion a year.
From that it gets tax benefit at the rate of 1.25 percent as cost. That means Tk 12.5 million will be considered as cost. These costs are added to the company's spending sector.
As per rule, when the cost of organization is become higher, the tax became lower. Reducing spending opportunities in the new budget it fixed to 0.5 percent.
In other words, the amount of tax benefits that used to be available in terms of expenditure will be further reduced if the budget proposal is implemented. This is likely to have a negative impact on the companies' profits.
NBR sources said most companies show higher costs in the name of promoting the business. This results in a large amount of tax evasion every year. This step has been taken to stop the fraud, said Syed Aminul Karim, a former member of the NBR.
He also said many companies have suffered severe financial losses during the Corona period.
It was not right to do so at this time. Many large companies will be under pressure if the proposal to reduce tax benefits is implemented. This can have an adverse effect on employment also.