The National Board of Revenue has launched massive campaign against value added tax evasion by fast food shops, hotels and restaurants.
The VAT audit, intelligence and investigation directorate of the NBR took the initiative after there were allegations that the businesses were not depositing VAT to the government exchequer though they had collected it from customers.
There are also allegations that many food stores and restaurants are not using Electronic Cash Register (ECR) or Point of Sales (POS) machines in financial transactions. But they are required by law to use such machines.
In 2009, the NBR made it mandatory for 11 types of business to install and use ECR machine and Point of Sales (POS) software to boost the VAT collection.
The types include hotels, restaurants, sweetmeat shops, community centres, all shops at mega malls in the metropolis, departmental stores, general stores, big and medium-size wholesalers and retailers at the metropolis etc.
NBR said most of the traders were yet to install the device, which it saw as “frustrating” after repeated calls since 2009.
A review of complaints by NBR showed that 80% of the complaints were made against food stores and restaurants, 10% against super shops and the remaining 10% against shops that fall in other types.
The VAT intelligence wing found the situation “very alarming” and went to start raiding shops in different parts of the capital city.
Although the previous such raid was limited to some specific restaurants and food stores, the current intiative will cover a larger part of the city.
During a day-long raid recently, a number of food stores in Khilgaon area were found non-compliant. Four seperate teams were engaged in the raid which covered 16 shops finding most of them using no ECR or POS device.
The non-compliance was identified as a way to evade VAT.
“We targeted Khilgaon to make it a model area in VAT payment by bringing all the food stores there under the (ECR or POS) system,” said an official who was in one of the teams.
“Such drive will be launched gradually in different parts of the city including Gulshan, Banani, Dhanmondi, Uttara, Badda, Banasree, Motijheel, Old Town and Jatrabari,” he added.
Besides, such drive would also be conducted in other major cities like Chittagong to improve VAT collection.
The revenue board targets to collect Tk1,76,370 crore revenue, of them amount Tk64,262 crore as VAT, this fiscal year.