Income tax LTU surpasses target despite odds

[ First Page ] 2010-07-04

Income tax LTU surpasses target despite odds

GP pays largest amount Large taxpayers paid more than Tk 3.5 billion in excess of the tax target set for the large taxpayers unit (LTU) in the just concluded fiscal (FY) (2009-10) with the cell phone giant GrameenPhone (GP) contributing the most. GP paid nearly Tk 7.50 billion in taxes in the FY'10 despite enjoying a tax cut because of its listing with the bourses. Last year, the GP paid Tk 5.35 billion. Officials said the GP paid tax at a rate of 35 per cent as it offloaded share in the last fiscal. The GP paid tax at a rate of 45 per cent in 2008-09 fiscal. The tax officials have estimated the loss at worth Tk 1.20 billion because of its listing. Islami Bank paid Tk 3.33 billion, up by Tk 100 million from the previous fiscal, to become the second largest taxpayer in the last fiscal. Standard Chartered Bank paid Tk 2.50 billion in 2009-2010 fiscal holding the third position. In the fiscal 2008-09, the bank paid Tk 2.20 billion in taxes. The LTU under the income tax department has able to surpass the target through effective monitoring in the month of July. "The LTU has collected 25 per cent of its annual target in July alone. Despite many hurdles, the unit could surpass its target for 2009-2010 fiscal," said a senior official of LTU. The target for LTU was Tk 58 billion out of Tk 165 billion total collection target for income tax department. According to a provisional figure, the unit collected Tk 61.65 billion in the fiscal 2009-10, which is a record collection in the history of LTU. Tax officials said there were some challenges to meet the revenue collection target in last fiscal. The government reduced corporate tax rates to 42.5 per cent from 45.0 per cent in the budget for 2009-2010. Revenue officials estimated the loss at Tk. 2.0 billion for the cut in corporate tax rates. The tax officials have estimated Tk 3.0 billion losses for 10 per cent tax rebate for investment in CSR (corporate social responsibility). A number of corporate taxpayers also enjoyed 10 per cent tax rebate for sponsoring in SAAF games. The LTU was able to achieve the first ever success in revenue collection amid several negative indicators, said a senior LTU official. "The unit devised some strategies for the second half of the last fiscal to overcome those constraints in revenue collection," he said. The LTU increased number of audit teams to beef up revenue collection by plugging leakage, he added. Direct communication with the large taxpayers, intensified monitoring to boost advance tax collection, data collection from different organization to find out tax evasion did help the revenue collection efforts of the unit, the official said. The LTU has a total of 987 taxpayers in its jurisdiction. Of the taxpayers, 279 are corporate and 708 are individual taxpayers. The unit introduced online tax returns last year to facilitate large taxpayers. A total of 40 taxpayers have submitted online return until January 2010. Of them, 33 are corporate taxpayers and seven individuals.