National Board of Revenue on Wednesday served four separate notices on state-run Petrobangla and three of its companies demanding a total of Tk 2,701 crore in VAT and supplementary duty which the entities did not pay on increased price of gas from March 1, 2017 to September 17, 2018.
The board’s Large Taxpayers Unit (VAT) issued the notices, which also would be considered as show-cause notices, seeking written explanations within 15 days of issuance of the notices from the entities —Petrobangla, Bangladesh Gas Field Company Ltd, Sylhet Gas Field Ltd, and BAPEX.
The notices, signed by LTU commissioner Muhammad Mubinul Kabir, served as primary demand notice under article 55 (1) of Value-Added Tax Act-1991.
Of the amount, LTU demanded Tk 1,826 crore in VAT and SD from Petrobangla, Tk 753 crore from BGFCL, Tk 109 crore from SGFL and Tk 13 crore from BAPEX.
LTU officials said that the entities did not collect the VAT and SD from consumers on increased portion of gas price during the period.
Bangladesh Energy Regulatory Commission increased prices of gas by 22.70 per cent which became effective in two phases — March 1, 2017 and June 1, 2017.
BERC in its notification issued on February 23, 2017 kept the increased price out of the purview of VAT and SD.
On the other hand, NBR on October 3 withdrew 93.24 per cent SD, 15 per cent VAT and some other taxes on import, production, trading and supply stage of gas including liquefied natural gas to keep the price of gas at affordable level after import of costly LNG.
NBR gave the exemption effective from September 18, 2018.
LTU officials said that they took opinion from board’s high-ups on the applicability of VAT for the period.
LTU also formed a review committee consists of representative of Petrobangla and other entities to examine the issue.
The committee also found the applicability of VAT and SD for the period of March 1, 2017 and September 17, 2018.
LTU will finalise the demand after getting response from the Petrobangla and its companies.
It will take legal steps including realisation of the amount based on documents if the companies do not give reply, they said.
LTU is also in dispute with Petrobangla and its four gas distribution companies—Titas, Karnaphuli, Bakhrabad and Jalalabad gas transmission and distribution companies—over payment of VAT and SD worth around Tk 17,700 crore (excluding interest) collected from consumers on the prices of gas during 2009 and 2016.
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