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State-owned Jamuna Fertilizer Company Ltd, despite being profitable and holding huge amounts in fixed deposit receipts (FDRs), had not settled its taxes for around nine years.
Their tax delinquencies met with an unprecedented enforcement this month.
In an unprecedented move, taxmen froze all of Jamuna's bank accounts nationwide and encashed some of their FDRs to recover Tk 860 million in outstanding taxes for the fiscal years 2013-14 to 2021-22.
This action follows similar raids in May, where Tk 507 million and Tk 143 million in outstanding taxes were recovered from private firms Ulka Games and Tiger IT, respectively.
These stringent tax enforcement measures and intensive monitoring by Tax Zone-15 in Dhaka -- which handles the income tax files of Jamuna, Ulka and Tiger IT -- have resulted in a record collection of Tk 2.69 billion in undisputed tax claims.
On June 5, circle-310 (company) of Tax Zone-15 encashed FDRs from frozen bank accounts of Jamuna Fertilizer Limited, owned by the Bangladesh Chemical Industries Corporation, to recover Tk 860 million in undisputed tax claims dating back to 2013-14.
This is the first instance of the National Board of Revenue (NBR) taking such stern action against a state-owned company for non-payment of taxes.
Commissioner of Taxes at Tax Zone-15 Ahsan Habib said despite several notices, Jamuna had not settled the outstanding amount.
Last week, Tax Zone-15 ordered all banks to freeze Jamuna's bank accounts across the country. It was found that the company held FDRs worth Tk 13.45 billion in various banks.
To recover the pending taxes, tax authorities encashed ten FDRs held in six branches of Basic Bank and Janata Bank. Releasing the funds from the FDRs took two days.
A six-member tax inspection team led by Deputy Commissioner Md Nefaul Islam Sarker, under the supervision of Commissioner Ahsan Habib, recovered the taxes.
In the previous month, Tax Zone-15 recovered Tk 507 million from Ulka Games Limited and Tk 143 million from Tiger IT by encashing their savings schemes from frozen bank accounts.
"We have implemented intensive monitoring of the financial accounting software used by 2,800 companies and firms," said Mr Habib. "This involved training tax officials in the zone to operate the software effectively."
These bold steps against tax evaders, applied equally to state-owned and private companies, have contributed to a 50 per cent increase in revenue collection by Tax Zone-15, he added.
"Our main challenge was motivating bank officials to fulfil their legal obligations to release tax amounts from frozen accounts," Mr Habib recalled. "Initially, banks were hesitant to release the funds."
According to tax law, bank managers or their supervisors can be held liable for non-payment of taxes if they fail to cooperate with tax authorities' requests to release seized funds.
Deputy Commissioner Md Nefaul Islam Sarker said there were previously undisputed tax claims worth Tk 1.55 billion, which Tax Zone-15 has now fully recovered.
"Efforts are on to expedite the settlement of tax disputes pending in courts," he added.