Tax(Case Report-on-Income-Tax-Authorities-in-Bangladesh)

ASSIGNMENT on Income valuate Authorities in Bangladesh pic issue table of evaluate NBR Rajashwa Bhaban Segunbagicha, Dhaka Telephone +88 02 933-3444. http//www. nbr-bd. org topic hop on of evaluate income (NBR), Bangladesh. rogue 2 of 31 Table of contents Serial motif scallywag No. I Cover . 01 knave.. . II result/Source of the ASSIGNMENT.. 02 III Table of 03 contents 01 Letter of 04 contagion.. 02 credit 05 03 Background of 06 NBR.. 04 gross enhancementation and its 07 history 05 assess Authorities of Bangladesh .. 10 06 Types of Income 12 07 motley of impose systems.. 13 08 Types of 14 measure incomeation.. 09 methodology . 15 9. 01 Sources of Income 15 9. 02 task wander 16 9. 03 levy discount outrank for investment . 16 9. 04 Who should submit Income task father? 17 9. 05 clip to submit Income Tax Return 18 9. 06 mind action .. 19 9. 07 Tax keep back functions .. 19 9. 08 Major atomic morsel 18 as for final elimination of appraise liability . 22 9. 09 Fiscal incentives .. 23 9. 10 scheme of reprise gross Agreement . 24 10 Steps for collecting Income Tax in Bangladesh.. 24 11 Procedure of judgment . 25 12 Problems for collecting Income Tax.. 26 13 Conclusion.. 31 .. field room of assessation (NBR), Bangladesh. foliate 3 of 31 Letter of Transmittal marching music 03, 2012 To Md. Abdul Awal Chairman, EECS deparment NorthSouth University Basundhara Campus, Dhaka. Subject Submission of Assignment on Income Tax Authorities in Bangladesh. Dear Sir I am pleased to submit this Assignment- written report on Income Tax Authorities in Bangladesh. This research program was repleten by the serve well of Three evaluate system of Bangladesh, create verb in ally by M. A. Akkas, and Income Tax written by Mr. Mahmud and Purohit Bhattacharjee. Here is the report on the observational study of Income Tax federal position in Bangladesh.We honestly believe that this r eport will sue the requirements of the campaign report, which will help us a lot to seduce sufficient knowledge about the Income Tax authority in Bangladesh Sincerely, deb kumar Roy ID0910019040 topic climb on of gross (NBR), Bangladesh. scallywag 4 of 31 Acknowledgement I am very much grateful to the God first, who has apt(p) me all the ability to per represent this chore. At last unless non the least, I am grateful to my ever-respected p arnts those who always give us genial support and well wishes. discipline plug-in of Revenue (NBR), Bangladesh. Page 5 of 31 Background of NBR The discipline Board of Revenue (NBR) is the central authority for evaluate administration inBangladesh. Itwas establishbyPresidentsOrderNo. 76of1972. Administratively, it is chthonian the Internal Re firsts Division (IRD) of the Ministry of fo infra (MoF). MoF has 3 Divisions, headed by 3 permanent Secretaries to the Government, namely, the Finance Division the Internal Re root systems Div ision (IRD) and the stinting Relations Division (ERD). The Secretary, IRD is the ex-officio Chairman of NBR.NBR is responsible for formulation and continuous re-appraisal of impose-policies and measure-laws, negotiating tax income revenueation treaties with contradictory governances and participating in inter-ministerial deliberations on economic issues having a purpose on fiscal policies and tax administration. The main responsibility of NBR is to collect interior(prenominal) revenue (primarily, Import Duties and Taxes, VAT and Income Tax) for the politics. Other responsibilities include administration of all matters associate to taxes, duties and another(prenominal)(a) tax producing fees. under(a) the planetary control of IRD, NBR administers the Excise, VAT, Customs and Income-Tax operate consisting of 3434 officers of various grades and 10195 supporting staff positions (Ap provoked set up as on 09 Feb. , 2000 AD). Negotiating tax treaties with foreign governments and participating in inter- ministerial deliberations on economic issues having a bearing on fiscal policies and tax administration ar in like manner NBRs responsibilities. The main responsibility of NBR is to mobilize domestic resources through accretion of import duties and taxes, VAT and income tax for the government.Side by side with collection of taxes, facilitation of worldwide trade through quick clearance of import and export political machinegoes has overly emerged as a key role of NBR. Other responsibilities include administration of matters related to taxes, duties and other revenue related fees/charges and prevention of smuggling. Under the overall control of IRD, NBR administers the excise, VAT, customs and income-tax work consisting of 3434 officers of various grades and 10195 supporting staff positions. National Board of Revenue (NBR), Bangladesh. Page 6 of 31Taxation and its history Taxation- one of the study sources of habitual revenue to meet a countrys r evenue and using expenditures with a view to accomplishing well-nigh economic and societalobjectives, much(prenominal)asredistributionofincome,pricestabilizationand discouraging harmful consumption. It supplements other sources of universe finance such as issuance of currency notes and coins, charging for public goods and service of processs and borrowings. The term Tax has been derived from the French word Taxe and etymologically, the Latin word Taxare is related to the term tax, which way to charge.Tax is a contribution exacted by the state. It is a non-penal but compulsory and unrequited transfer of resources from the private to the public sector, levied based on predetermined criteria. According to Article 152(1) of the Constitution of Bangladesh, revenue includes the imposition of both tax, rate, duty or impost, whether general, local or special, and tax shall be cons sured accordingly. wander is a local tax imposed by local government on its residents or the attribute owners of the locality, a duty is a tax levied on a commodity, and an impost is a tax imposed for an submission into a country.Under the supplying of article 83 of the Constitution, no tax shall be levied or still except by or down the stairs the authority of an Act of Parliament. Bangladesh inherited a system of gross from its erst duration(prenominal) British and Pakistani rulers. The system, however, developed based on generally pass judgment give the axeons and there had been efforts towards rationalizing the tax administration for optimizing revenue collection, reducing tax tergiversation and preventing revenue leakage through system loss.Taxes include narcotics duty (collected by the Department of Narcotics Control, Ministry of Home Affairs), land revenue (administered by the Ministry of Land and collected at local Tahsil offices numbered on bonny, one in all both Union Parishads), non-judicial feeling (collected on a lower floor the Ministry of Finance), regis tration fee (collected by the readjustment Directorate of the Ministry of Law, Justice and Parliamentary Affairs) and motor vehicle tax (collected under the Ministry of Communication). National Board of Revenue (NBR), Bangladesh.Page 7 of 31 The tax organize in the country consists of both take up (income tax, gift tax, land development tax, non-judicial stamp, registration, immovable property tax, and so on and indirect (customs duty, excise duty, motor vehicle tax, narcotics and pot liquor duty, VAT, SD, foreign travel tax, TT, electricity duty, advertisement tax, etc) taxes. The present land revenue system of Bangladesh has its base in the East Bengal state l gatheredness and tenancy act 1950 which established a direct contract between the tax generateer and the government.The intimately important tax on the economic cling to of transferred property is the non-judicial stamp tax (levied under the Stamp Act 1899), which has been in existence since January 1899. Current ran ge of non-judicial stamp duty are provided in the First Schedule of the Finance Act 1998, ranging from Tk. 4 to Tk. 10,000 in case of absolute rate, or from 0. 07% to 1. 5% of the economic value of consideration in case of ad valorem rate. The judicial stamp tax is being levied under the solicit Fees Act 1870, although the levy of address fees originated in the introduction of the Bengal Regulation No. 8 of 1795. The first gross revenue tax was introduced in the former Central Provinces of India in 1938. In Bengal, gross sales tax was adopted in 1941. In 1948, sales tax was transferred as a central tax under the General Sales Tax Act of 1948. The Sales Tax Act 1951 came into force on 1 July 1951 by repealing the Pakistan General Sales Tax Act of 1948. Until 1982, sales tax was being collected under the 1951 Act, which was replaced by the Sales Tax regulation 1982. The VAT law was published by repealing the Business.Income tax was first introduced in the subcontinent by the Brit ish in 1860 to make up the revenue dearth caused by the sepoy revolt, 1857. After independence of Bangladesh, income tax was made effective under the Income Tax Act 1922 passed on the basis of the recommendations of the All-India Income Tax Committee plant in 1921. Currently, income tax has been imposed under the Income Tax Ordinance 1984 (ITO) promulgated on the basis of recommendations of the Final Report of the Taxation Enquiry consignment submitted in April 1979.Income tax contributeers (assesses) are separate as individuals, partnership firms, Hindu single(a) National Board of Revenue (NBR), Bangladesh. Page 8of 31 families (HUF), associations of soulfulnesss (AOP), companies (publicly traded and private), local authorities, and other artificial juridical persons. Tax rates and scope of taxable income disaccord based on residential status of an assesses (resident or non- resident). From fiscal or judgement form, (AY) 2000-01, there is a filing threshold of annual tot up income of Tk. 00,000 applicable for individuals (including non-resident East Pakistanis), partnership firms, HUF, AOP and assesses other than companies and local authorities. In case an individuality of this group has a total annual income less than this level, he is not required to submit tax deliver but if someones income is higher, he is to pay a negligible tax of Tk. 1,000. Bangladesh inherited a system of taxation from its past British and Pakistani rulers. National Board of Revenue (NBR), Bangladesh. Page 9 of 31 Tax Authorities of Bangladesh ? There are 3-divisions under the Ministry of Finance (MOF) and Secretary leads some(prenominal)ly division. ? The Chairman of NBR (National Board of Revenue) is working under Internal Resource Division (IRD). ? NBR is the apex body of the Tax Administration. It consists of devil parts (1) Customs & VAT (2) Income Tax. Both are under the equivalent authority.There are 4-members under NBR. ? Under the NBR, a Comm issioner of Taxes is the head of the department and he is in charge of a taxes regularize. There are 8- districts in Bangladesh. National Board of Revenue (NBR), Bangladesh. Page 10 of 31 pic National Board of Revenue (NBR), Bangladesh. Page 11 of 31 Types of Income Income Assessable IncomeNon-Assessable Income Taxable Income Non-taxable Income Income Income actor eitherthing received in cash or in kind unless exempted by laws. 1) Assessable Income Assessable Incomes are those incomes, which are included in the ratiocination of total income of a taxpayer. ) Taxable Income Taxable Incomes are those incomes that the tax is to be remunerative on those incomes. b) Non- Taxable Income Non taxable income is taken into total income for taxation rate purpose but no tax is to be paying on this part of income. 2) Non- Assessable Income Non- assessable incomes are those incomes which are not included in the determination of total income of a taxpayer. National Board of Revenue (NBR), Ban gladesh. Page 12 of 31 Classification of Tax systems Classification of Tax organisation Single Tax Multiple Taxes 1. Single Tax Only one tax for everybody.Single tax is the poll tax or the head tax or adolescent tax, which is imposed on a person simply because he is there in the baseball club. 2. Multiple TaxesA system under which different types of taxes shall be levied by the govt. according to suitability. Ex. Income Tax, VAT. National Board of Revenue (NBR), Bangladesh. Page 13 of 31 Types of Taxation Types of Taxation a) Direct Tax b) confirmative Tax a) Progressive Tax b) regressive Tax c) Proportional Tax a) Direct Tax Direct tax is a sort of tax the impact of effect incidents and which fall gage on the person on whom it is imposed. . e. Income Tax, Marriage Tax etc. b) Indirect Tax Indirect taxes are those burden of which empennage be passed on others through price vehicles. c) Progressive Tax The tax rate increases as the taxable income/ tally increases. d) Regressive tax The opposite of a advanced tax is a regressive tax where the tax rate decreases as the taxable income/ step increases. e) Proportional Tax In between is a proportional tax, where tax is fixed as the amount to which the rate is utilize increases. National Board of Revenue (NBR), Bangladesh. Page 14 of 31 MethodologyAmong direct taxes, income tax is one of the main sources of revenue. It is a progressive tax system. Income tax is imposed on the basis of ability to pay. The to a greater extent a taxpayer earns the much than he should pay- is the staple fibre principle of charging income tax. It aims at ensuring equity and social justice. Sources of Income For the purpose of computation of total income and charging tax thereon, sources of income abide be classified into 7 categories, which are as follows Salaries reside on securities Income from house property Income from agriculture Income from clientele or job Capital gains Income from other sources. Tax Rate (Assessment Year- 2008-09) Other than Comp both For individuals other than female taxpayers, of age(p) taxpayers of 70 geezerhood and above and retarded taxpayers, tax payable for the First 1,65,000/- null attached 2,75,000/- 10% Next 3,25,000/- 15% Next 3,75,000/- 20% respire Amount 25% For female taxpayers, senior taxpayers of age 70 years and above and retarded taxpayers, tax payable for the First 1,80,000/- Nil Next 2,75,000/- 10% Next 3,25,000/- 15% National Board of Revenue (NBR), Bangladesh. Page 15 of 31 Next 3,75,000/- 20% Rest Amount 25% Minimum tax for any individual assesses is Tk. 2,000 Non-resident Individual25% (other than non-resident Bangladeshi) For Companies Publicly Traded Company27. 5% Non-publicly Traded Company37. 5% Bank, Insurance & Financial Company 45% Mobile Phone floozie Company45% If any publicly traded company declares more than 20% dividend, 10% jargon discount on total tax is allowed. Tax Rebate for investment Rate of Rebate Amount of allowab le investment is either up to 25% of total income or Tk. 5,00,000/- whichever is less.Tax rebate amounts to 10% of allowable investment. Types of investment subject for the tax rebate are Life insurance premium portion to deferred annuity Contribution to Provident Fund to which Provident Fund Act, 1925 applies self contribution and employers contribution to Recognized Provident Fund Contribution to crack Annuation Fund Investment in approved unsecured bond or debenture stock, Stocks or Shares Contribution to deposit pension scheme Contribution to eleemosynary Fund and Group Insurance premium Contribution to Zakat Fund grant to charitable hospital approved by National Board of Revenue Donationtophilanthropicoreducational innovationapprovedbythe Government Donation to socioeconomic or cultural development institution established in Bangladesh by Aga Khan Development meshworkwork National Board of Revenue (NBR), Bangladesh. Page 16 of 31 Who should submit Income Tax Return? If total income of any individual other than female taxpayers, senior taxpayers of 70 years and above and retarded taxpayers during the income year exceeds Tk 1,65,000/-. If total income of any female taxpayer, senior taxpayer of 70 years and above and retarded taxpayer during the income year exceeds Tk 1,80,000/-. If any person was assessed for tax during any of the 3 years right off preceding the income year. A person who lives in any city pot/paurashava/divisional HQ/district HQ and owns a building of more than one storey and having plinth area exceeding 1,600 sq. feet/owns motor car/owns membership of a club registered under VAT Law. If any person subscribes a telephone. If any person runs a chore or profession having trade license. Any professional registered as doctor, lawyer, income tax practitioner, Chartered Accountant, price & Management Accountant, Engineer, Architect and Surveyor etc. Member of a Chamber of craft and Industries or a trade Association. Any person who pa rticipates in a tender. A person who has a Taxpayers Identification Number (TIN). Candi take care for Union Parishad, Paurashava, City Corporation or Parliament. Time to Submit Income Tax Return For CompanyBy fifteenth side veridical day of July next following the income year or, where the fifteenth day of July falls before the demise of six months from the end of the income year, before the expiry of such six months. For Other than Company Unless the date is extended, by the thirtieth day of September next following the income year. Consequences of Non-Submission of Return imposition of punishment amounting to 10% of tax on last assessed income subject to a minimum of Tk. 1,000/- In case of a continuing default a save penalty of Tk. 50/- for every day of delay.National Board of Revenue (NBR), Bangladesh. Page 17 of 31 Assessment Procedures For a return submitted under rule scheme, assessment is made after hearing. For returns submitted under Universal egotism Assessment Schem e, the acknowledgement slip is determined to be an assessment order. Universal Self Assessment is of course subject to audit. Appeal against the order of DCT A taxpayer can file an appeal against DCTs order to the Commissioner (Appeals)/Additional or Joint Commissioner of Taxes (Appeals) and to the Taxes appellate Tribunal against an Appeal order. Tax withholding functionsIn Bangladesh withholding taxes are usually termed as Tax deduction and collected at source. Under this system both private and public limited companies or any other organization specified by law are legally authorized and bound to withhold taxes at some point of making payment and deposit the same to the Government Exchequer. The taxpayer receives a certificate from the withholding authority and gets credits of tax against assessed tax on the basis of such certificate. Heads of Income Subject to deduction or collection of income tax at source with specified rates of deduction. No. Heads separate/Rule Rate Chala n in the name of 1 Salaries various(prenominal) portion 50 deduction at average rate regularize 2 Discount on the real value of deduction at normal rate or upper limit rate LTU Bangladesh Bank Bills arm 50A whichever is greater. 3 Interest on securities Section 51 10%on interest or discount LTU 4 Supply of goods and execution of nil up to 1 lac, 1-5 lacs Zone-2 (Partly) & contracts and sub-contracts Section (1%), 5-15 lacs (2. 5%), 15- LTU 52(Rule 16) 25 lacs 3. 5% and 25 lacs and above (4%) National Board of Revenue (NBR), Bangladesh. Page 18 of 31 5 Indenting counsel / Shipping 3. 5% of the total receipt of indenting Zone-2 office staff management Section 52 (Rule 17) commission & 5% of total Shipping agency commission receipt 6 Royalty, Fees for professional or Zone-8 technical services Section 52 A 10% of the fees 7 Stevedoring agency & Security Section 52 Ctg. Zone- service AA 7. 5% of the fees 2 8 C & F agency commission S ection 52 Zone-2 AAA 7. 5% of the fees 9 Sale of bandrolls ( for biri) Respective Section 52B 6% of the value of bandrolls. Zone 10 Compensation for acquisition of 6% of the compensation money Zone-2 property Section 52C 11 Interest on saving instruments 10% of the amount of interest (Current Zone-2 Section 52D rate) 12 Collection of tax from brick 1 Sec. = Tk. 10,000/ for each brick field. Respective manufacturers 1. 5 Sec. = Tk. 2,000/ for each brick Zone field. Section 52F 2 Sec. = Tk. 18,000/ for each brick field. 13 Commission on Letter of 5% of the amount of commission. LTU Credits Section 52I 14 publicize & Re immatureal of trade Tk 500/- For renewal of each Zone-3 licence Section 52K Lincence 15 Trustee fees Section 52L 10% 16 Frieght Forward agency Com. Section 52M 7. 5% 17 Rental power Section 52N 4% 18 Import of goods Section 53 (Rule17A) Zone-2 3% of the value of imports. 19 Income from house proper ty (house No deduction if monthly rent is under Zone-2 rent) 20,000/- Dha & Other Section 53A (Rule17B)3% (if monthly rent is outside 20,000-40,000 Tk. ) and Zone 5% (if monthly rent is above 40,000 Tk. 20 Shipping business of resident Zone-2,ctg Section 53AA 5% of freight 21 export of work force Section 53B (Rule Zone-2, dhk & ctg 17C) 10% of the service charges. 22 Export of Knitwear Section 53BB 0. 25% Zone-5 23 Member of Stock Section Zone-7 Exchange 53BBB 0. 015% 24 Export of goods except Section 0. 25% Zone-5 National Board of Revenue (NBR), Bangladesh. Page 19 of 31 Knitweare & Woven garments 53BBBB 25 Sale of goods by public auction Section 53C (Rule Zone-2 17D) 5% of the sale price 26 messenger Service (Non- resident) Zone-6 Section 53CC 7. 5% 27 Payment to film actors and actresses 5% of the amount compensable exceeding Zone-2 Section 53D (Rule Tk. 6000/- 17E) 28 Cash reward Section 53DD 5% Zone-5 29 Commission Fees or discount paid to Zone-2 & LTU distributors Section 53E (Rule 7. 5% of the amount of commission. 17G) 30 Commission or charges paid to the Dhk. Zone- factors of foreign buyers 6, Ctg.Zone-3 and 4 % on the amount of commission or charges. Zone of Section 53EE Respective Division 31 Interest on bank deposits Section 53F (Rule 10% of the amount of interest. Zone-1 17H) 32 Real Estate & Developers In case of Bldg. 250 per sq. eter Zone-5 In case of land 5% of deed value Section 53FF 33 Insurance commission 3% on the amount of commission LTU Section 53G 34 Commission paid to the Surveyors of Dhk. Zone- General Insurances 2, Ctg. Zone-3 and 7. 5% on the amount of commission. Zone Section 53GG of Respective Division 35 conveying of property Section 53H (Rule 5% of the value of the property. Survey 17I) Zone Interest on Post Office No deduction if the amount of interest does Zone-2 Savings Bank Account not exceeds Tk. 1,50,000 and if exceeds Section 53I thusly 10% on the amount of interest . 36 Rent of empty land, plant and No deduction if monthly rent is below Zone-2 machinery 15,000/- Section 53J (Rule 3% (if monthly rent is 17BB) 15,000 -30,000 Tk. ) and 5% (if monthly rent is above 30,000 Tk. ) National Board of Revenue (NBR), Bangladesh. Page 20 of 31 37 Advertising bill of news paper, Zone-5 magazine, private television 3% of the value of the property. channel Section 53K 38 Dividend LTU (only LTUs (1) Resident individual 10%, non-resident files) all others Section 54 individual 25% (2) Company 15% Zone-2 39 Income from lottery Section 55 20% of the amount won. Zone-2 40 Income of non-resident Other than Company rate applicable to the com. OtherZone-6 non- resident Bangladeshi Section 56 than company maximum rate. Major areas for final settlement of tax liabilityTax deducted at source f or the following cases is treated as final discharge of tax liabilities. No additional tax is charged or refund is allowed in the following cases- Supply or contract work Band rolls of consider made cigarettes Import of goods Transfer of properties Export of manpower Real Estate Business Export value of garments Local shipping business Royalty, technical know-how fee Insurance agent commission. Auction purchase Payment on account of survey by surveyor of a general insurance company Clearing & forwarding agency commission. Transaction by a member of a Stock Exchange. messenger business Export cash subsidy Tax Recovery SystemIn case of non-payment of income tax demand the following measures can be taken against a taxpayer for realization of tax- Imposition of penalty supplement of bank accounts, salary or any other payment. Filing of surety case to the Special Magistrate. National Board of Revenue (NBR), Bangladesh. Page 21 of 31 Advance Payment of Tax Every taxpayer is required to pay advance tax in four equal installments falling on fifteenth September 15th December 15th March and 15th June of each year if the latest assessed income exceeds Taka three lakh. Penalty is imposed for default in payment of any installment of advance tax. Fiscal incentives pastime are fiscal incentives available to a taxpayer )Tax spend Tax holiday is allowed for industrial undertaking, tourist industry and physical infrastructure facility established between 1st July 2008 to 30th June 2011 in fulfillment of legitimate conditions. industrial Undertaking suitable for Tax holiday (i)An industry diligent in merchandise of textile, textile machinery, jute goods, high value garments, pharmaceuticals, melamine, plastic products, ceramics, sanitary ware, vane from iron ore, MS Rod, CI Sheet, fertilizer, insecticide & pesticide, computer hardware, petro-chemicals, agriculture machinery, boilers, compressors, basic raw materials of drugs, chemicals and pharmaceuticals. (ii)An in dustry engaged in agro-processing, ship building, diamond cutting. somatogenetic Infrastructure Eligible for Tax holidaySea or river port, container terminals, subjective container depot, container freight station, LNG terminal and transmission line, CNG terminal and transmission line, gas subway line, flyover, mono rail, underground rail, telecommunication other than mobile phone, large water supply discourse plant & supply through pipe line, waste treatment plant, solar energy plant, export processing zone. Tourism Industry Eligible for Tax holiday Residential hotel having facility of three star or more. b)Accelerated depreciation Accelerated depreciation on cost of machinery is admissible for new industrial undertaking in the first year of commercial production 50%, in the second year 30% and in the terce year 20%. )Income derived from any Small and Medium Enterprise (SME) engaged in production of any goods and having an annual turnover of not more than taka twenty four lak h is exempt from tax. d)Industry set up in EPZ is exempt from tax for a period of 10 years from the date of commencement of commercial production. e)Income from fishery, poultry, cattle breeding, dairy farming, horticulture, floriculture, mushroom cultivation and sericulture are exempt from tax up to 30th June, 2011, subject to investing at least 10% of the exempted income that exceeds one lakh Taka, in government bonds. National Board of Revenue (NBR), Bangladesh. Page 22 of 31 f)Income derived from export of handicrafts is exempted from tax up to 30th June, 2011. )An amount equal to 50% of the income derived from export business is exempted from tax. h)Listed companies are entitled to 10% tax rebate if they declaredividend of 20% or more. i)Income from Information Technology Enabled Services (ITES) business is exempted up to 30th June, 2011. dodging of Double Taxation Agreement There are agreements on dodge of double taxation between Bangladesh and 28 countries which are- (01) U nited solid ground of Great Britain and Northern Ireland (02) Singapore (03) Sweden (04) Republic of Korea (05) Canada (06) Pakistan (07) Romania (08) Sri Lanka (09) France (10) Malaysia (11) Japan (12) India (13) Germany 14) The Netherlands (15) Italy (16) Denmark (17) China (18) Belgium (19) Thailand (20) Poland (21) Philippines (22) Vietnam (23) joker (24) Norway (25) USA (26) Indonesia (27) Switzerland (28) Oman. National Board of Revenue (NBR), Bangladesh. Page 23 of 31 Steps for collecting Income Tax in Bangladesh Submission of income tax returns is generally due by 30th September in case of non-companies and thirty-first December in case of companies. Assessment is made in several procedures. They are ? Self assessment ? Presumptive assessment ? Spot assessment ? Pre-audit based assessment. However, certain percent of self assessment cases are selected for audit.Assesses can prefer appeal if aggrieved by his assessment. There are three radical forums for appeal. They are to the appellate Commissioner/Additional Commissioner/Joint Commissioner or to the Commission for reviews. The decisions of Appellate Commissioner/Additional Commissioner/Joint Commissioner can be challenged to the next Appellate Court named as Appellate Tribunal. Withholding tax is levy able on a number of items including contractors, imports, transfer of urban land/building, bank deposits etc. National Board of Revenue (NBR), Bangladesh. Page 24 of 31 Procedure of Assessment Generally the followings steps are followed in case of Assessment of theCompany and the Corporation Step-1 Computation of Business Income Step-2 Computation of summation Income Step-3 Determination of tote up Tax Liabilities Step-4 Determination of Net Tax Liabilities According to Sections 28, 29 and 30 of ITO, 1984 Income from business is to be calculated after considering admissible and inadmissible expenses to this end. Total Income of the Company is to be calculated by adding other income with income fr om business. Total Tax liabilities are to be determining by applying prescribed tax rate. Net Tax liability is to be ascertained by deducting the following tax rebate from Total Tax liabilities 10% Tax rebate on foreign income Tax rebate on increased production in case of industrial company, if applicable. Tax rebate on export income (at rate applicable) Tax rebate and average rate on tax free income. National Board of Revenue (NBR), Bangladesh. Page 25 of 31 Problems for collecting Income Tax Tax dodging is one of the main problems for collecting Income Tax by the Income Tax self-confidence in Bangladesh. It is the legal utilization of the tax regime to ones own advantage, in order to reduce the amount of tax that is payable by means that are within the law. By contrast tax escapism is the general term for efforts to not pay taxes by bootleg means. The term tax mitigation is a synonym for tax turning away.Its original use was by tax advisors as an alternative to the pejorative term of tax shunning. lately the term has also been used in the tax regulations of some jurisdictions to place tax avoidance foreseen by the lawmakers from tax avoidance which exploits loopholes in the law. base on these concepts arises the pillars of Tax Protesters as well as Tax resistance Some of those enterpriseing not to pay tax believe that they nonplus unveil interpretations of the law that show that they are not subject to being taxed these individuals and groups are sometimes called tax protesters. An unsuccessful tax protestor has been attempting openly to table tax, while a successful one avoids tax.Tax resistance is the declared refusal to pay a tax for conscientious reasons (because the resister does not want to support the government or some of its activities). Tax resistors typically do not take the position that the tax laws are themselves illegal or do not apply to them (as tax protesters do) and they are more concerned with not paying for particular govern ment policies that they oppose. National Board of Revenue (NBR), Bangladesh. Page 26 of 31 Responses to tax avoidance Avoidance also reduces government revenue and brings the tax system into disrepute, so governments need to prevent tax avoidance or keep it within limits. The obvious way to do this is to put in tax rules so that there is no scope for avoidance. In practice, this has not proved achievable nd has led to an ongoing battle between governments amending legislation and tax advisors finding new scope for tax avoidance in the amended rules. Tax nonremittal By contrast, tax evasion is the general term for efforts by individuals, firms, trusts and other entities to evade taxes by illegal means. Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities to reduce their tax liability, and includes, in particular, dishonest tax reporting (such as declaring less income, profits or gains than actually e arned or overstating deductions). Illegal income and tax evasionWho earn income by illegal means (gambling, theft, drug trafficking etc. ) is required to report unlawful gains as income when filing annual tax returns. Suspected lawbreakers have therefore been charged with tax evasion when there is insufficient certainty to try them for their non-tax related crimes. Other times, tax evasion can be used as a one more nail in the coffin by prosecutors by stating that if a person earns illegal income, s/he whitethorn also be guilty of tax evasion. Those who attempt to report illegal income as coming from a legitimate source could be charged with money laundering. National Board of Revenue (NBR), Bangladesh. Page 27 of 31 Evasion of Value Added Tax (VAT)During the latter half(prenominal) of the twentieth century, Value Added Tax (VAT) has emerged as a modern form of consumption tax through the world. Producers who collect VAT from the consumers may evade tax by under-reporting the amou nt of sales. Control of evasion Level of evasion depends on a number of factors one of them being fiscal equation. Peoples dip to evade income tax declines when the return for due payment of taxesisnotobvious. Evasionalsodependsontheefficiencyofthetax administration. rot by the tax officials often render control of evasion difficult. Tax administrations recourse to various means for plugging in scope of evasion and increasing the level of enforcement.Public opinion on tax avoidance Tax avoidance may be considered to be the dodging of ones duties to society, or alternatively the right of every citizen to structure ones affairs in a manner allowed by law, to pay no more tax than what is required. Attitudes vary from approval through disinterest to outright hostility. Attitudes may vary depending on the steps taken in the avoidance scheme, or the perceived unfairness of the tax being avoided. Corruption by tax officials Corrupt tax officials cooperate with the tax payers who nail d own to evade taxes. When they detect an instance of evasion, they refrain from reporting in return for illegal gratification or bribe.Corruption by tax officials is a stark problem for the tax administration in a huge number of underdeveloped countries. National Board of Revenue (NBR), Bangladesh. Page 28 of 31 The distinction in various jurisdictions of Tax Evasion and Tax Avoidance The use of the terms tax avoidance and tax evasion can vary depending on the jurisdiction. In general, the term evasion applies to illegal actions and avoidance to actions within the law. The term mitigation is also used in some jurisdictions to further distinguish actions within the original purpose of the relevant provision from those actions that are within the letter of the law, but do not turn over its purpose. National Board of Revenue (NBR), Bangladesh. Page 29 of 31 ConclusionThough the rate of tax revenue is to GDP is very negligible, despite the government is nerve-wracking to maximize its tax revenue through different method. But the government should also remind the cannon of convenience while collecting tax from assesses. As we are living in a civilized society should come forward to pay taxes to government in order to film the administrative, defense and development activities of the country. Otherwise we would not be able to prove ourselves as civilized people. Tax is the most important in the hand of the government to control the prudence as well as the inflection. It also helps in push money to the economy, develop certain source of the economy and control some other activities of the economy.No Government can run its and perform administration works without collecting tax as a source of revenue. So, the Government imposes tax over the company and the corporations. On the other hand Government can also intensive to the infant and certain basic industry for protection through its tax policy. National Board of Revenue (NBR), Bangladesh. Page 30 of 31 ? The End ? National Board of Revenue (NBR), Bangladesh. Page 31 of 31 pic pic pic pic pic pic pic pic ? pic pic pic pic pic pic pic pic pic pic pic