Tk52,433cr VAT paid by 110 cirms in FY22

Only 110 large companies paid around half the value added tax (VAT) collected by the National Board of Revenue, out of over 300,000 registered firms.

The businesses deposited consumption tax worth Tk52,433 crore out of Tk108,000 crore total VAT receipt by the NBR in FY22, according to its large taxpayers unit (LTU) VAT data.

Economists said that the potential of VAT revenue has to be explored immediately to cover the growing budget shortfall of the government.

A major part of this tax worth Tk27,830 crore came from cigarette- manufacturing companies.

The amount is 53.07 per cent of the total revenue collected by the LTU.

British American Tobacco Bangladesh Co Ltd (BATB) Ltd alone paid Tk24,726 crore in VAT.

A new unit of BATB, located in Savar, also paid another Tk1,170 crore.

United Dhaka Tobacco Co Ltd paid Tk1,933 crore.

However, VAT payment by both the tobacco companies declined 0.74 per cent for BATB and by 3.77 per cent for UDTC last year.

A senior VAT official said that some local companies were selling and marketing tobacco items openly without having valid licences.

Outreach of such companies outside the metropolitan cities resulted in decline in sales of cigarettes in formal channels, he added.

According to LTU data, BATB's VAT payments showed a sharp increase during the last five years.

In FY18, the company paid Tk16,539 crore in VAT followed by Tk19,696 billion in FY19, Tk20,766 crore in FY20, and Tk24,911 crore FY21.

The VAT payment by UDTC in the last five years was not consistent as the company paid Tk3,707 crore in FY18, Tk5,848 crore in FY19, Tk2,731 crore in FY20 and Tk2,009 crore in FY21.

The Telecom sector is the second-largest contributor of the value tax.

Four large telecommunications companies paid VAT worth Tk8,516 crore, up by Tk51 crore from the previous FY's collection.

The largest telecommunications operator, Grameenphone, paid Tk4,452 crore in the past fiscal.

However, the VAT payment by the company declined 0.73 per cent year on year.

Robi Axiata Ltd paid Tk2,375 crore, up by Tk32.3 crore compared to the previous FY.

Banglalink Digital Communication Ltd's VAT payment also grew 3.09 per cent last year.

The company paid Tk1,546 crore to the public exchequer.

State-owned Teletalk Bangladesh Ltd also paid 3.55 per cent higher year on year.

The company paid a total of Tk142 crore in VAT last year.

VAT collection from 20 large pharmaceutical companies increased 11.20 per cent last year.

The companies paid VAT worth Tk3,483 crore last year, up by Tk351 crore over the corresponding period in the previous year.

As economic activities gained momentum after the Covid-19 pandemic, collection of the consumer tax from five posh hotels grew 116.32 per cent last year.

The luxury hotels--Pan Pacific Sonargoan, Intercontinental Dhaka, Radisson Blu Water Garden Dhaka, Dhaka Regency Hotel and Resort Ltd, Unique Hotel & Resorts Ltd--paid VAT worth Tk94.4 crore last year. 

A major part of this tax worth Tk27,830 crore came from cigarette- manufacturing companies