Move against VAT-evading social media-based businesses

Staff Correspondent

17 February, 2021 12:00 AM printer

The National Board of Revenue (NBR) has instructed its VAT intelligence wing to step up monitoring activities to check VAT evasion through trading through Facebook and other social media platforms.

NBR Chairman Abu Hena Md Rahmatul Muneem, however, directed the officials to work honestly and not to harass the compliant traders who are paying revenue to the government.

After rising in the VAT evasion through social media trading, the NBR chairman made the directive on Tuesday. Meanwhile, the VAT intelligence department has recommended action under the VAT Act against 19 Facebook-based business entities participating at a shopping fair at a Dhaka restaurant recently.

The recommendation has been sent to the Dhaka North, Dhaka South and Dhaka West Tax Commissioners to take legal actions against the 19 companies for      

violating the VAT Act. According to the NBR’s VAT intelligence, 19 vendors who mainly operates business by opening Facebook page, participated in a day-long fair at a restaurant called 'O Play' in Gulshan on Friday last.

Informed by a source, an operation was carried out, led by assistant director of VAT Intelligence Muhammad Mohi Uddin and found such 19 stalls at the fair venue.

All the stall owners have their own Facebook page for selling different type of products including readymade garments and cloths of women and children as well as jewelry items.

During the raid, the VAT intelligence found that only two of the 19 vendors have VAT registration. However, they also do not file regular VAT returns. The remaining 17 have no VAT registration, officials said.

As per the existing VAT Act, no business can be conducted without VAT registration. For the online shopping 5 percent VAT is applicable.

The VAT intelligence said similar fair was organised twice few weeks earlier in that restaurant in Gulshan, Dhaka. Even then the products were sold without paying VAT.

VAT detectives have collected information of the individuals and sales information of each stall owner.