Four gas cos stop paying VAT again [ Tritiyo Matra News ]

Four gas cos stop paying VAT again

Local August 18, 2016

Four major state-owned gas distribution companies have again stopped paying value-added tax and supplementary duty collected by them from their consumers on the prices of gas after paying the taxes for few months in 2015 though the companies have dues of Tk 13,278 crore to the National Board of Revenue, officials said.
They said that the companies paid Tk 2,623 crore as VAT and SD for the period between April 2015 and October 2015 and after that they refrained from paying the taxes.
In addition to Tk 13,278 crore in dues for the period of July 2009 to March 2014, the companies — Titas, Karnaphuli, Bakhrabad and Jalalabad gas transmission and distribution companies —did not pay another Tk 6,823 crore for the period between April 2014 and
March 2015, and from November 2015 to June 2016, according to the NBR data.
In this situation, the large taxpayers unit (value-added tax) of the revenue board sought NBR intervention in realising the dues and regular taxes from the companies.
LTU (VAT) commissioner Shahnaj Parveen on July 21 wrote a letter to the revenue board chairman, Md Nojibur Rahman, in this connection.
According to the VAT office, since 1998 the companies have been collecting VAT and SD from the consumers of industrial, electricity, fertiliser, compressed natural gas, captive power, tea garden, commercial and household sectors.
But, the companies have been depositing the taxes collected only from industrial consumers.
There are 40 per cent SD and 15 per cent VAT on the prices of gas at the selling stage.
The companies have been selling the gas extracted by the international oil companies (IOCs) since 1998 to the consumers.
In February 2015, the VAT office detected the evasion between July 2009 to March 2014 and claimed Tk 19,594 crore as VAT, SD and interest for non-payment of the taxes.
Of the amount, the four companies collected Tk 13,278 crore as SD and VAT and the remaining amount of Tk 6,318 crore as interest amount on the taxes.
Of the principal amount, Titas Gas dodged the highest amount — Tk 10,988 crore in VAT and SD — followed by Karnaphuli Gas Tk 1,268 crore, Bakhrabad Gas Tk 672 crore and Jalalabad Gas Tk 348 crore.
There is no estimate on how much VAT and SD the companies evaded from 1998 to 2009.
Since February 2015, the VAT office several times asked the companies to pay the amount.
But the companies did not pay the taxes on various pretexts such as the international oil companies are exempted from paying such taxes and the Bangladesh Oil, Gas and Mineral Corporation, known as Petrobangla, pays taxes on behalf of the OICs.
An inter-ministerial committee formed to settle the issue in September 2015 recommended that the companies deposit the taxes collected in April 2015 and May 2015 by the following month to the government exchequer and after that the companies will regularly pay the taxes to be collected from June 2015 and onwards.
After a long bargaining, the companies paid Tk 2,623 crore for the period of April 2015 to October 2015.
The issue of the outstanding amount for July 2009 to March 2014 will be settled after conducting an audit on it as per recommendation of the committee.
The finance ministry and the Petrobangla are in negotiation to settle the dispute, under which the ministry may provide the amount to the companies as subsidy in bridging the gap between the gas prices of purchase from the IOCs and selling to consumers.