Only one per cent of newspapers in Bangladesh pays income tax to the government. Only six newspaper publishing companies submitted their annual income tax returns and paid the tax to the National Board of Revenue (NBR) in the last financial year (2023-24). However, a total of 28 companies in this sector submitted their tax returns. Of these, 22 had no taxable income.
According to the statistics of the Directorate of Films and Publications (DFP) of the information and broadcasting ministry in August, 584 daily newspapers are published from Dhaka and elsewhere. The newspapers that paid income tax in the last financial year were Prothom Alo, The Daily Star, Samakal, Financial Express, Bangladesh Pratidin (East-West Media Group) and Dainik Azadi published from Chattogram. According to NBR sources, the six newspapers pay an average of Tk 250 million as corporate tax every year.
The rates of corporate tax on newspapers are high. Besides, newspapers have to pay high duty on import of newsprint. However, newspaper circulation and advertisements are declining. The newspaper owners have been demanding for exemption of corporate tax and zero tariff on import of newsprint for a while, which is not fulfilled.
Prothom Alo’s publisher company Mediastar Limited is registered under Large Taxpayer Unit (LTU). This organisation pays the highest tax in the media category. Mediastar has been paying an average of Tk 100 to 120 million in income tax annually for the past few years. The rest of the newspaper publishing houses are registered taxpayers of tax zone-5. Dainik Azadi is registered in Chattogram tax zone.
NBR every year honors the highest taxpayers of the country in different categories including media houses and journalists. Every year, 4-5 media companies get the accolade from the NBR. Mediastar Limited, the parent company of Prothom Alo, has received the honour for eight consecutive years. Mediaworld Limited, the parent company of The Daily Star, received the accolade four times.
The Daily Star editor Mahfuz Anam and Prothom Alo editor Matiur Rahman have been named among top taxpayers in the journalist category for eight years in a row. The NBR introduced tax cards and certification to recognise compliant taxpayers across various sectors and professions for the last eight years.
Transparency International Bangladesh’s (TIB) executive director Iftekharuzzaman told Prothom Alo that the media industry should be brought under accountability as one of the major roles of the newspapers is to ensure transparency in governance.
Whether the media itself pays taxes or not, whether the income-expenditure information is correct or not, whether there is a lack of transparency in ownership are the prerequisites for the media to play its role properly. There are so many newspapers, but they do not submit tax returns. Such practice undermines the moral standing for their role.
According to Iftekharuzzaman, there should be discussions about the income and expenditure of newspapers and media, transparency of taxes and ownership as the new government is thinking of forming a media commission.
Only 6pc newspapers submit returns
In the last fiscal year (FY2023-24), only 28 daily newspaper publishing houses have submitted their returns to the income tax department disclosing their income and expenditure of the previous financial year. This is only 6 per cent of total newspapers published from across the country. The remaining 94 per cent of newspapers did not submit their tax return.
At present a total of 284 daily newspapers are published from Dhaka district. Newspapers published from Dhaka district have to be registered in tax zone-5. However, three-fourths of the newspaper publishing houses do not even have a Tax Identification Number (TIN). It is learnt that 67 companies have TIN in tax zone-5 of Dhaka. Only 26 dailies out of 67 filed returns in the last financial year.
The list of newspapers which filed returns last time includes Prothom Alo, The Daily Star, Samakal, Bangladesh Pratidin, Kaler Kantho, Jugantor, Daily Sun, Financial Express, Dhaka Tribune, New Age, Ittefaq, Jaijaidin, Manabzamin, Dinkal, Naya Diganta, Bhorer Kagoj and Inqilab etc.
There are reasons for filing returns even if there is no taxable income. It has been learnt that any newspaper that claims the circulation number of over 100,000 copies to DFP must have income tax payment certificate as the advertisement rates are determined as per the circulation. It is alleged that some newspaper owners show circulation numbers of more than 100,000 to import more newsprint under duty-free facilities.
According to the information and broadcasting ministry sources, 57 daily newspapers showed a circulation of more than 100,000 copies in the month of August.
Tax-related conditions for newspapers
‘Media Registration and Audit Policy of Newspapers and Periodicals-2022’ was published in January, 2023. According to the policy, the newspapers have to fulfill income tax related requirements for various tasks including media’s registration; audit procedures and calculation of getting newsprint.
According to the Printing Presses and Publications (Declaration and Registration) Act, 1973, there are three types of tax related conditions to be fulfilled for registration of newspaper media. First, the publisher must have a TIN and Business Identification Number (BIN). Secondly, the newspapers' bank statement and income-expenditure statement of the last six months. Thirdly, in the case of newspapers published from Dhaka and divisional cities, copies of audit reports and in other cases copies of income tax returns should be provided.
According to the Media Registration and Audit Policy of Newspapers and Periodicals-2022, some issues should be noted during the audits. For example, the financial records of import, procurement and use of news print are evaluated in the audit. Moreover, statements of income and expenditure, bank statements and income tax return are also evaluated in the audit.
Tax rate for newspaper industry
Although the newspaper industry is a service-oriented sector, the tariff rate in the industry is relatively high. According to NBR sources, there is currently a 5 per cent import duty, 15 per cent VAT and 5 per cent Advance Income Tax (AIT) imposed on newsprint, the main raw material of newspapers. In all, the tax burden is about 27 per cent. The total cost or landed cost of newsprint including import price and taxes stands at 127 per cent. Transport costs are added to this.
Moreover, 5 per cent in AIT on raw materials import and 4 per cent tax deduction at source (TDS) is paid on the income from advertisement that makes for a total of 9 per cent advance income tax. However, the stakeholders maintain that most newspapers do not even make a profit of 9 per cent on their total income. That’s why the Newspapers Owners Association (NOAB) has long been demanding a corporate tax rate of 10-12 per cent in the newspaper industry.
While different industrial sectors enjoy many tax facilities, the newspaper industry does not get any such privileges. At present, the ready-made garment sector gets additional tax benefits. The corporate tax rate for this sector is 12 per cent. For the green-factories or environmentally friendly factories, this rate is even lower, 10 per cent.
On the other hand, the corporate tax on newspaper is 27.5 per cent as non-listed company (not listed in the stock market). However, if the condition of bank transfer (transaction through bank) is fulfilled in the case of overall transaction, the tax rate is slightly reduced to 25 per cent.
“Taxes should be withdrawn from newspapers”
The newspaper was declared an industry in 2014. But over the decade, newspaper publishing houses have hardly received any tax benefits.
Newspaper Owners Association of Bangladesh (NOAB) president AK Azad told Prothom Alo that the government has given newspapers the status of a service industry but there is no government incentive despite the recognition. But other industries get some kind of benefits from the government.
"The declaration and advertisements of printed newspapers have long been declining. In this situation, all types of taxes should be withdrawn from newspapers. In the past, newspaper owners used to import newsprint without duty. We want restoration of that facility.
AK Azad said, “While the revenue from advertisement is decreasing, the tax burden is increasing on the other hand. Moreover, all the newspapers owe more than Tk 1 billion to the government for advertisements. We are not getting any specific information from the government regarding the payment of these dues. We hope that the current government will take appropriate steps to pay the outstanding bills.”