The Financial Express

Vietnamese firm to charge Tk 140m for continuing support to automated VAT admin

| Updated: February 12, 2021 10:07:20

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The government will have to pay Tk 140 million to the Vietnamese firm FPT from its own coffer as per contract with the company to avail its support for continuing automated VAT administration after June 30, 2021.

The VAT Online Project (VOP) is scheduled to expire in the current fiscal year (FY), 2020-21, that ends on June 30.

Allocation of the amount will be needed for availing the post-warrantee services that the company is set to provide until March 22, 2022.

The VOP project director Kazi Mustafizur Rahman has requested the National Board of Revenue (NBR) to keep a budget allocation in the next FY, 2021-22, for this purpose, if the government wants to avail the company's services after expiry of the project.

Allocation of the fund in the budget for the post-warrantee period of the project will be needed to keep the integrated VAT administration or IVAS system operational after expiry of the project, Mr Rahman said in a letter to the NBR.

The IVAS system has been developed through the VOP, and FPT Information System Corporation of Vietnam is working as a vendor for developing the IVAS software.

The company will provide services including network LAN/WAN, server database maintenance and support for the IVAS.

As the project is set to end this FY, the VOP will not be able to pay bill for the work from June 30 to March 22, 2022 from the project fund, he added.

The NBR will have to take over the IVAS-related tasks, including LAN/WAN, data centre, server, maintenance of recovery server, integration of IVAS with the banks and other organisations, system update, work of system configuration, renewal of SAP-ERP software licences, and overall security management-related software after expiry of the project, and pay bill to the firm from the government coffer.

According to the VOP data, the government will have to pay an annual US$ 2,11,395 for integrated VAT administration system (COTS), $ 3,60,045 for project management, integration and delivery and user training in IVAS, $ 14,562 as software costs including enterprise security management tool (if provided separately from COTS), $ 3,810 software cost for anti-malware for enterprise, $ 8,44,20,000 for network service (NWS), and $ 2,19,636 for managed support services (MSS).

The government will have to pay Tk 7.0 million per month for network services to the company.

The VOP chief opined that the NBR can appoint a local vendor for network services from July to save cost, as bandwidth prices dropped in recent times.

The NBR can use double mbps at Tk 70 million annually, if it appoints a local vendor for network services.

Although the government initially projected Tk 6.09 billion as cost of the VOP, finally it may be completed at a cost of Tk 3.40 billion.

The NBR launched the project on May 09, 2014, with the fund support from the World Bank and the government.

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