vat

VAT collection registers 17pc growth in FY’23 despite adversities

Collection of value-added tax (VAT) grew by 17 per cent last fiscal year (FY) despite multiple challenges on both external and domestic trade fronts.

Though the government adopted austerity measures amid adverse economic situations, and the revenue board missed a substantial amount of VAT against some projects, desperate drives by the VAT wing of the National Board of Revenue (NBR) facilitated the collection, according to a statement issued on Thursday.

It said the manufacturing industries too faced a blow in spite of opening letters of credit (LCs) and importing raw materials due to the increase in utility bills that hampered the natural pace of the manufacturing sector.

The VAT wing collected Tk 1.25 trillion in FY ’23 which is Tk 170.04 billion more than that of the previous year.

It has collected 92 per cent of the FY’s ambitious target of Tk 1.36 trillion which is marked as ‘outstanding’ as per Annual Performance Agreement of the Ministry of Finance.

VAT collection grew by 18 per cent alone in the month of June, 2023 alone.

In FY 2021-22, the NBR had achieved 11.19 per cent growth in VAT collection.

The NBR has collected Tk 1.25 trillion VAT in the last FY against Tk 1.08 trillion in the previous FY.

Of the amount, the VAT wing mobilised Tk 156.14 billion revenue in the month of June alone.

Dhaka South, Khulna and Chattogram achieved the highest growth among the 12 VAT zones across the country.

Chattogram VAT zone achieved 38.71 per cent growth, followed by Khulna 24.71 per cent and Dhaka South 19.89 per cent.

Large Taxpayers unit (LTU) has collected the highest VAT worth Tk 585.66 billion among the zones.

NBR officials said it’s an outstanding achievement of the VAT wing in this adverse economic situation thanks to intensified monitoring by the field offices, relentless efforts by VAT officials, updating input-output coefficient of businesses and measures to check VAT evasion.

The NBR has collected Tk 30 billion more in taxes from tobacco users while achieving 11 per cent growth in VAT collection from mobile phone users.

VAT collection from MS Rod increased by 58.46 per cent, beverages by 31.19 per cent, cement 33.72 per cent, rentals of commercial space by 20.11 per cent.

From Petrobangla and Bangladesh Petroleum Corporation (BPC), VAT collection grew by 21.68 per cent and 23.43 per cent respectively.

From the sale of sweetmeat, the NBR achieved 38 per cent growth while residential hotels 39 per cent, restaurants 16.78 per cent.

Though VAT rates for restaurants have been reduced to 5.0 per cent from 15 per cent, the NBR collected 16.78 per cent higher VAT from the businesses as the officials were active to check evasion.

Source: The Financial Express

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