The VAT officials would have to face difficulties in cross-checking the financial details furnished in the VAT (Value Added Tax) returns filed by the global technology giants as the companies do not have their respective offices in Bangladesh.
The main obstacle that the officials would face is to communicate with the representatives of the non-resident companies like Google, Facebook, Netflix and Amazon as and when necessary.
However, the National Board of Revenue (NBR) is yet to start auditing the VAT returns filed under the Customs, Excise and VAT Commissionerate, Dhaka South.
The revenue authority made it mandatory in July 2019 for the non-resident companies to submit VAT returns, aiming to cross-check the actual business transactions and the amount of VAT paid.
The provision, however, took two years to come into force due to absence of required amendments of the VAT laws and provisions.
Talking to the FE, VAT commissioner (south zone) Showkat Ali Saadi said it is difficult to communicate with the tech companies unless they set up offices in Bangladesh.
The VAT officials have to contact their representatives here if they want to audit the VAT files, he added.
Officials said the process of auditing the companies has been determined in the Audit Manual-2022, issued recently by the NBR.
The non-resident companies are maintaining their VAT payment accounts and appointed VAT agents as per instruction of the NBR, but the agents will not be liable for any mismatch, they added.
The VAT-registered global tech giants are: Google Asia Pacific Pte. Ltd., Google Ireland Limited, Amazon Web, Facebook Ireland Limited, Facebook Payments International Limited, Facebook Technologies Ireland Limited, Microsoft Regional Sales PTE Ltd., Netflix Pte. Ltd and Amazon.com Services.
In an analysis of the VAT payment data, the FE correspondent has found some fluctuations in payment of VAT in cases of some non-resident companies.
Most of the companies paid no VAT in some months from May 2021.
During May 2021 to June 22, Google Asia Pacific Pte Ltd paid the highest Tk 40 million in October 2021 and lowest Tk 5.6 million in May 21. However, there was no payment in February 2022.
The company paid a total of Tk 214 million in VAT until June 2022 while Amazon web services paid Tk 45 million, Facebook Ireland Tk 325 million, Facebook Payments International Limited Tk 0.6 million, Facebook Technologies Ireland Limited Tk 0.5 million, Microsoft Regional Sales Pte. Ltd. Tk 46 million, Google Ireland Limited Tk 5.2 million, Netflix Tk 22 million and Amazon.com Services Tk 2.4 million.