NBR has to extend VAT return deadline

The National Board of Revenue (NBR) seems oblivious to the crisis caused by the coronavirus outbreak in the country. According to the rules, business firms are obliged to submit VAT return papers by the 15th of every month. Fines are imposed after the deadline.

Nobody objected to these rules so far, but now the COVID-19 pandemic has brought the overall economy to a halt, not just in Bangladesh but throughout the world. Under the circumstances, how logical is the NBR’s rigid position regarding the Value Added Tax (VAT) return papers?

Sheikh Fazle Fahim, president of FBCCI (Federation of Bangladesh Chambers of Commerce and Industry), wrote a letter to the NBR chairman on 9 April requesting an extension of the VAT return deadline.

But NBR remained stubborn about its earlier decision, and decided to open a limited number of VAT circle offices on public holidays from 12 to 15 April for filing of VAT returns. How do the business firms file return documents when almost all of them are closed due to the coronavirus lockdown?

Businesspersons said amid the government declared general holiday, except for emergency services, all government institutions and the National Revenue Board (NBR) VAT offices at the field level are closed. It is simply not possible for them to file a VAT return at the given time.

The NBR says the office will be open to a limited extent. How do the business owners file the papers in the areas where the NBR office will be closed?

According to Prothom Alo reports, there are currently 178,000 registered companies for VAT return. Of this, between 100,000 to 110,000 companies submit returns every month. There is a provision for submitting VAT return through government office and online.

However, Dhaka and Chittagong region are lagging behind in collecting VAT returns online. Again, the government collects the majority of the VAT from these two regions.

On 12 April, the Daily Star reported that the finance minister was talking about extending the VAT return deadline. Yet why is NBR not taking reality into account? The NBR has to accept that this is an exceptional situation.

Everything has been closed for months or more in Bangladesh, even worldwide – an unprecedented situation. Considering this unusual reality, the NBR has to make logical decisions.

People are requested to maintain social distancing to combat virus transmission. People are asked to stay home and that is why everything is closed. In this situation, asking to submit a VAT return means asking businessmen to gather at the NBR offices and put everyone at risk of infection.

We hope NBR will take the necessary steps to relax the VAT return deadline considering the situation. It would be logical to postpone the VAT returns filing until the current lockdown is over. If there are legal barriers in this regard, these should be resolved by the NBR itself.