No LC opening without new e-BINs after Oct 31

Staff Correspondent | Published: 00:00, Oct 01,2019

 
 

A file photo shows goods-laden containers at Kamalapur in Dhaka. The National Board of Revenue has requested the Bangladesh Bank to ask all commercial banks not to open letters of credit for importers without online-generated 13-digit business identification numbers after October 31.— New Age photo

The National Board of Revenue has requested the Bangladesh Bank to ask all commercial banks not to open letters of credit for importers without online-generated 13-digit business identification numbers after October 31.

The revenue board has also extended the deadline for traders to update their existing BINs into the 13 digit format with the value-added tax online system.

VAT Online Project director Syed Mushfequr Rahman in a letter on Sunday made the request to the central bank deputy governor Ahmed Jamal, informing the BB about the NBR decision.

He wrote the letter after the tax authorities had come to know that commercial banks were continuing to open LCs using old BINs, although both the nine-digit e-BINs and 11-digit BINs had become obsolete after August 14, the previous deadline for obtaining the new 13-digit e-BINs.

He said that the VAT collection process was being hampered as a significant number of existing VAT payers was yet to update their BINs.

Implementation of online VAT returns submission would also not be possible without the 13-digit BINs, he added.

Only 37,186 businesses have so far obtained fresh online BINs or updated their previously obtained nine-digit e-BINs since July after the NBR issued a directive to update the status of e-BINs in line with the new VAT and Supplementary Duty Act 2012 that came into force on July 1, 2019.

A total of 1.66 lakh businesses obtained the nine-digit e-BINs till June 30 this year from the NBR’s online BIN registration system introduced in March, 2017.

Another 5,346 traders registered themselves as turnover VAT payers with the system.

Several lakhs of 11-digit BIN holders had already obtained BINs before the introduction of the online BIN registration system in the country.

NBR in the first week of July asked businesses to update their existing BINs with the database of the VAT online system.

The online system provides a new 13-digit BINs,  adding new four digits as identification of the location of businesses with the previous nine-digit BINs.

Mushfeq, in the letter to the central bank, said that it was necessary to update the BIN database for businesses to implement the new VAT law as the country’s VAT system would be managed online under the new law.

Opening LCs without the 13-digit BINs would create complexities in future, he said.

Considering the situation, the revenue board had decided to extend the deadline for updating the BINs up to October 31, he added.

The central bank had been, therefore, requested to ask commercial banks not to open LCs without the new BINs, he said.

He said that a significant number of VAT payers had not obtained their 13-digit BINs within the August 14 deadline.

Officials said that NBR had instructed its field-level VAT offices in early September to issue new BINs within three days of getting applications from traders as a large number of applications had remained pending with the offices due to various reasons, including technical problems.

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