The Financial Express

Number of tax returns from new taxpayers poor this year

Experts blame taxmen's inaction against non-compliance

| Updated: December 10, 2019 19:47:46

Number of tax returns from new taxpayers poor this year

The number of income tax returns, submitted by individual taxpayers until the deadline (December 01), remained far below taxmen's expectations.

The number increased by only 0.1 million this year despite several efforts on the part of the taxmen, countrywide survey and tax fairs included.

The tax officials had expected at least 0.5 million tax returns from the new individual taxpayers this year.

The time for submission of income tax returns by the individual taxpayers for fiscal year (FY) 2019-20 expired on Sunday (December 01).

Last year, the National Board of Revenue (NBR) received 2.1 million tax returns that have increased to 2.2 million in this FY.

Lamenting the dismal increase in the number of tax returns, Md Mosharraf Hossain Bhuiyan, the NBR Chairman, vowed to launch move to ensure regulatory compliance of the taxpayers.

Talking to the FE, he said the number of submitted tax returns is not satisfactory compared to the taxmen's relentless efforts.

"We have already issued Taxpayers Identification Number (TIN) to some 0.6 million to 0.7 million new taxpayers through countrywide survey."

Now the NBR will find out the taxpayers who did not submit tax returns despite having TIN or taxable income.

He, however, said the number of tax returns will increase by December 15, which is the deadline for submission of tax returns by some companies.

"Field-level tax offices have informed me that the number of tax returns will go up to 2.3 million by the end of this year."

He said some 359,000 taxpayers have submitted applications, seeking more time to submit their tax returns.

The number of TIN holders is around 4.6 million until December 2, 2019. However, half of them do not submit tax returns, as it is not mandatory for all TIN holders to submit returns.

Former finance adviser to the caretaker government Dr Mirza Azizul Islam said a 'sense of impunity' works among the people who do not submit tax returns, as there is no action for such non-compliance.

"Some people find that there is no follow-up for not submitting tax returns. They want to avoid the hassle of tax return submission and facing queries from taxmen."

The wide gap between the number of tax returns and e-TIN holders has been persisting in the country for a long time, he further said.

Notices should be served, asking the noncompliant taxpayers to submit tax returns within a given timeframe.

The taxmen should take legal actions for not complying with the notices, he added.

Dr Ahsan H Mansur, executive director of the Policy Research Institute (PRI), said it is the NBR's weakness, as they do not approach the non-compliant taxpayers.

"The taxmen want discretionary power, and they are not willing to automate the tax department."

There is lack of 'willingness' and 'ability' on the part of the taxmen to analyse and prepare a database (of the non-compliant taxpayers), he opined.

The taxpayers face audits just after submission of their tax returns. They should be exempted from that for a few years to encourage submission of tax returns by others, he added.

The tax officials said a large number of well-off people are not submitting tax returns, whereas compliance rate is high among the salaried taxpayers.


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