The National Board of Revenue on Sunday demanded Tk 926 crore in value-added tax from mobile operator Robi saying that the company ‘evaded’ the amount in various ways from January 2013 to December 2016, said officials.
Large Taxpayers Unit (VAT) of the revenue board also issued five separate show-cause notices to Robi seeking reply within 15 days on why the VAT authority would not ask the company for paying the amount.
NBR officials said that the show-cause notices would also be considered as primary demand notices and next steps would be taken based on the response of the company.
In a written statement Robi told New Age that a show-cause notice was a regular process. ‘We will provide our legal rational accordingly.’
NBR officials said that a team of the LTU detected the evasion through a special audit conduct following merger of Robi and Airtel.
Of the amount, Robi evaded payment of Tk 553.61 crore in VAT and Tk 158.21 crore in VAT at source from the period while the operator did not pay Tk 91 crore in VAT on Robi-Airtel merger fee and spectrum renewal charge of 2G licence of Airtel, and Tk 5.22 crore in VAT on interconnection charge.
The operator also unlawfully received VAT rebate worth Tk 116.40 crore during the period.
LTU commissioner Md Matiur Rahman on May 25 formed the team headed by its assistant commissioner Badruzzaman Munshi to conduct the audit.
The team on October 29 submitted its audit report for the period examining the information preserved in the internal software, known as SAP Software, of Robi, financial details obtained from its computer database, documents provided by the company and its VAT returns.
A high official of the LTU on Sunday told New Age that the VAT authority never conducted such an intensive audit on VAT files of the operator.
This time the LTU took the initiative to determine the liability of the company after acquisition of another operator-- Airtel.
Conventionally, VAT officials do not examine the software system but this time the LTU also examined it.
He said that Robi would also be able to seek opportunity for hearing along with giving written reply of the show-cause notices.
Officials of Robi can physically attend at the hearing or its lawyer can also attend it, he said.
The VAT authority will resolve the demand based on documents if the company does not reply to the notices within the deadline.
According to show-cause notices, the LTU team found that the total VAT payable amount of the company for the period was Tk 3,533 crore but Robi paid Tk 2,979 crore with VAT returns evading Tk 553.61 crore.
The operator was also supposed to pay Tk 553.34 crore as withholding VAT or VAT at source, but it paid only Tk 395.12 crore.
Robi also did not pay Tk 91 crore as VAT at the rate of 15 per cent on merger fee and spectrum renewal charge of 2G licence.
The operator has paid Tk 100 crore as merger fee and Tk 507 crore as spectrum renewal charge to Bangladesh Telecommunication Regulatory Commission following Robi-Airtel merger.
Robi also received VAT rebate worth Tk 116.40 crore on import of battery, cable, printed board, and router and switch which was unlawful as per VAT law.
Robi in its statement said that all rebates it had received were in accordance with the law and it was unfortunate that the telecom industry was treated differently when it came to VAT.
‘VAT on merger fee or VAT on any regulatory fees is already a sub justice (sub judice) matter,’ it said.
‘If BTRC registers for VAT all issues related to regulatory fees will be resolved,’ said Robi
‘It is unfortunate that NBR is not taking action to uphold the rule of law. Instead, NBR is only perusing operators,’ it said.
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