NBR set to introduce e-payment for VAT
Businesses would also be able to clear payments without visiting the VAT office
Alongside submitting VAT returns online, from now on businesses will be able to clear payments without visiting the VAT office as the National Board of Revenue (NBR) has finalised its e-payment method.
The Hongkong and Shanghai Banking Corporation Limited, Bangladesh (HSBC), Midland Bank Ltd and Prime Bank will provide the payment solution from home initially.
The NBR will add other banks to the system after the e-payment inauguration on July 16.
Kazi Mostafizur Rahman, director of the NBR VAT online project, said they have successfully completed the user account test of the e-payment module. The revenue board Chairman Abu Hena Md Rahmatul Muneem will inaugurate it.
"This method offers easy, safe and hassle-free payment of VAT and additional taxes from the bank account. The system will ease the inconveniences over payment," he added.
In association with the World Bank, the revenue board is implementing the VAT online project which aims at better implementation of new VAT law. The project is scheduled to be completed by December this year.
Outputs of the new law are unavailable to the expected level as the VAT process is yet to be totally automated, commented businessmen and VAT experts. They believe the e-payment will bring more benefits of the law once it is introduced.
In the meantime, Mostafizur Rahman said initially top 100 businesses, who contribute 30 percent of total VAT, will get the e-payment facility. Other entities will be brought to the digital process gradually.
In September last year,online submission for monthly VAT returns was inaugurated without an e-payment system. Revenue board officials said systematic complications including the tender floating delayed the project.
Sources at the NBR said the testing of the e-payment module was conducted successfully at three branches of HSBC, Midland and Prime Bank.
They said the e-payment system would be connected to the Bangladesh Bank's payment system, Office of the Controller General of Accounts and VAT office. The three offices and the payer will receive VAT payment receipts automatically which will make the process transparent and check VAT evasion.
Foreign Investors' Chamber of Commerce and Industry President and Berger Bangladesh Managing Director Rupali Chowdhury said, "We have been advocating for an e-payment method for a long time. The businessmen are ready to embrace the new system and it hopefully will decrease harassment."
On the other hand, the revenue board is also working VAT refund automation. Software is being developed for the refund process — one of the key factors of VAT automation.
Businessmen still get the refund manually which draws countless allegations of harassment.
Mostafizur said refund automation will be completed by September. The automatic process will issue cheques to the account of the businesses. They will not require claiming a refund at the VAT office.
He hoped the total automation of VAT would be ended by December.
NBR sources said 1.66 lakh businesses have so far registered for VAT submission online while 100-150 new entities are taking registrations per month. On an average 42,000 entities are paying VAT per month, but not all of them are submitting returns online.
As a single VAT commissionerate, 100 percent businesses in Jashore are submitting the returns online.
According to the VAT law, every business must submit the VAT returns of a month within its following 15 days. Otherwise, the business can be fined or charged penalty fees.
