Penalty imposed on new TIN holders, reviewed for old ones

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The government has proposed imposition of heavy penalty for offences related to the country’s income tax law and rationalisation of the existing penalty amounts.
In the Finance Bill-2015 for the national budget for the fiscal year 2015-2016, the government proposed imposition of a penalty at the highest Tk 5,000 on new taxpayer identification number holders for their failure in filing income tax returns.
It also proposed imposition of a penalty of Tk 1 lakh on taxpayers for submitting fake audit reports along with income tax returns.
Under the existing provision of the Income Tax Ordinance-1984, the revenue board may impose a penalty up to Tk 2 lakh to chartered accountants for providing incorrect and fake audit reports.
The National Board of Revenue in the proposed bill also rationalised the penalty amount for old taxpayers for non-submission of income tax returns and set the highest amount of penalty up to 50 per cent of the taxpayers’ taxes assessed in the previous year.
Currently, a deputy commissioner of taxes may impose a penalty amounting to 10 per cent of the TIN holder’s tax amount in the previous year or a minimum Tk 1,000 for non-submission of returns within the deadline and Tk 50 for each day delay after the deadline.
NBR officials said that sometimes the penalty amount became several times higher than the taxpayer’s actual tax due to the current penalty calculation method and to avoid such situation the highest penalty rate had been set at 50 per cent of tax.
It also proposed imposition of penalty up to Tk 50,000 on service providing agencies if the agencies fail to verify the authenticity of the electronic taxpayer identification numbers of service seekers.
According to the Income Tax Ordinance-1984, more than 25 government and non-government agencies including Bangladesh Road Transport Authority, gas and electricity supplying authorities, land registration offices, city corporations and banks are responsible to verify the authenticity of e-TIN of an applicant before providing services.
According to the ordinance, a deputy commissioner of taxes can impose a penalty up to Tk 20,000 on people for use of a fake TIN. For continuous use of a fake TIN deliberately, there is a provision of three years of imprisonment or imposition of fine up to Tk 50,000 or both.
The NBR also proposed imposition of a penalty up to 2 per cent of the value of each international transaction as penalty on the multinational companies for not submitting the statement of such transactions under transfer pricing provision.
It also proposed imposing as much 50 per cent of payable tax of a company or firm, or, Tk 5 lakh, as fine for recruiting unauthorised foreign nationals without work permits from the Board of Investment and other competent authorities of the government.
Source: New Age

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