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MINIMUM TAX ON DEALERS, DISTRIBUTERS

FBCCI for tax collection on value addition

Jasim Uddin | Published: 22:42, Jan 15,2021

 
 

The Federation of Bangladesh Chamber of Commerce and Industry has requested the National Board of Revenue to collect the minimum income tax on value addition instead of gross receipts of dealers, distributors and retailers.

The FBCCI on December 30 made the request after different trade bodies sought the apex trade body’s support over the issue.

The revenue board in the budget for the current fiscal year 2020-2021 imposed 0.5 per cent minimum tax for an individual having annual gross receipts of Tk 3 crore or more.

FBCCI president Sheikh Fazle Fahim in a letter to the NBR said that the rate of value addition at the dealing, distributing and retailing stage was between 2 per cent and 6 per cent.

The revenue board should impose the tax at 0.50 per cent on the added value for gross receipts over Tk 3 crore, he said.

The tax should be set after discussion with the FBCCI and relevant trade bodies, he added.

He also requested the NBR to collect value-added tax on value addition instead of gross receipts.

Officials of the revenue board said that they had received the request and would discuss with the NBR high-ups on the issue.

The decision will be made as per instructions from the government, they said.

Earlier, the Chittagong Chamber of Commerce and Industry, Moulvi Bazar Merchant Association and some other associations raised objections against the tax rate claiming that the tax rate was not consistent with the nature and income of such types of businesses.

The CCCI in a letter to the FBCCI said that traders at Khatunganj and Chaktai in Chattogram performed as middlemen between buyers and sellers and got a minimum profit or commission.

The range of profit or commission remains similar for products like sugar, spices, powered milk, baby foods and other imported products.

Traders as middlemen receive the amount of total transactions through bank accounts and pay back the money to the sellers, it said.

In recent times, income tax officials have been claiming minimum tax based on transactions shown in the bank statements, which is not consistent with the income of traders, it added.

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