Bangladesh Telecommunication Regulatory Commission, or BTRC, has decided not to collect VAT from the network operators, exposing the row with the tax authority.
According to the decision taken by the Posts and Telecommunication Division, the commission would collect only its own dues from the mobilephone operators, leaving the board to collect VAT.
The existing VAT law authorised the commission along with other entities in both the public and private sector to deduct VAT from the payment of different services.
The decision was taken at a meeting, chaired by post and telecommunication minister Mustafa Jabbar.
ICT affairs adviser to the Prime Minister Sajeeb Wazed Joy attended it.
In a recent letter, BTRC chairman Jahurul Haque conveyed the decision to NBR chairman Abu Hena MD Rahmatul Muneem.
Talking to the FE on Saturday, Mr Haque said the decision has been taken after the commission found it has no authority to take punitive action for the non-payment of VAT.
"We cannot freeze bank accounts or take legal action, which NBR can do," he said.
The BTRC has struggled to realise its own arrears from the telecom operators, he added.
"The telecommunication operators pay the dues of BTRC excluding an additional 15 per cent as VAT," he said.
The BTRC chief said the compliance of the law is poor.
"When NBR would enforce its law, telecom companies would be bound
to deposit the VAT either to the BTRC or directly to the NBR," he said.
Industry executives said the telecommunication operators could not claim VAT refund or rebate that they pay to the BTRC. The BTRC has no Business Identification Number, or BIN or VAT registration.
The regulator is not authorised to issue VAT chalan to the mobile phone operators. Producing VAT chalan is mandatory to claim VAT rebate by any companies, they added.
Earlier, the BTRC had requested the board to issue a BIN to it, but the commission failed to get even VAT registration, let alone BIN
Officials said the board is reluctant to issue BIN, fearing a possibility of huge amount of refund claim by telecom operators. BTRC is one of the major sources of VAT collection of the large taxpayers' unit.
Having concerned over the issue, the unit sent a letter to the board to take necessary measures in this regard, officials said.
It said the BTRC is legally bound to collect the VAT while taking its payment from the operators and deposit it to the public exchequer.
VAT officials said they expect a large amount of revenue from the BTRC's audit claim from Grameenphone and Robi
In April 2019, the regulator claimed Tk 125.79 billion as unpaid dues as taxes, late fees and revenue shares from Grameenphone based on audit. Of which, the NBR expects to receive Tk 40.86 billion as 15 per cent VAT.
From Robi, the BTRC claimed Tk 8.67 billion along with NBR's part at Tk 3.79 billion from Robi.
Of the audit claim, Grameenphone has paid Tk 1.0 billion and Robi Tk 550 million to the BTRC following an order of the Supreme Court.
