The National Board of Revenue (NBR) has withdrawn its directive to make Value Added Tax (VAT) information mandatory for approving bank loan proposals.
The NBR took the decision so that taxpayers do not face any problem in availing loans during COVID-19 crisis and affected individuals or organisations can easily get the incentive package announced by the government.
In this regard, the Directorate of VAT Audit, Intelligence and Investigation sent a letter to the central bank on Tuesday saying that the directive issued on June 16 to submit VAT information along with the loan proposal has been cancelled, reports BSS.
Director General of the Directorate of VAT Audit, Intelligence and Investigation Syed Mushfiqur Rahman said that as part of the strategy to increase internal revenue collection, financial statements or audit reports are submitted as part of proper verification of purchase and sale information mentioned in VAT returns.
“But it is very important to keep the wheel of the economy moving in the current coronavirus situation in the country. Therefore, the directive was cancelled so that the taxpayers do not face any problem in complying with the earlier issued directive,” he added.
Besides, he said, they have also taken into consideration the issue of ensuring that the affected individuals or organisations can easily get the incentive package announced by the government to address the Corona outbreak.
However, he said that the ongoing activities of the NBR to verify the information submitted to the bank through audit will continue.
The guidelines issued by the NBR for commercial banks on June 18 said that when a customer applies for a loan, the information of VAT return should be checked and sorted as ‘additional’ along with other required documents. In other words, VAT information is made mandatory in approving bank loans.
Many companies report multiple audits to evade revenue. Originally, the NBR issued the directive to submit VAT information to prevent revenue evasion.