Tax dispute cases delay Tk 190 billion collection

Tax collection

The Large Taxpayers Unit (LTU) of the income tax department revealed that the collection of approximately Tk 190 billion in direct taxes is held up in higher courts due to disputes from major corporations, individuals, and tax authorities.

Among these cases, 1,051 are pending, including 116 writs and 870 reference cases, causing significant delays in tax realization by the LTU, the key collector of direct taxes for the National Board of Revenue (NBR).

Following the meeting, Commissioner Md Iqbal Bahar of the LTU expressed the intention to collaborate closely with the attorney general’s office to settle these cases promptly.

The LTU, managing 1,313 tax files predominantly from major tax-paying entities like banks, non-bank financial institutions, insurers, telecom companies, manufacturers, pharmaceuticals, and 860 high-earning individuals, collected Tk 258,58 billion in taxes during the fiscal year 2022-23, constituting one-fourth of the total income tax acquired by the revenue administration that year.

Despite settling Tk 15 billion worth of tax disputes through alternative dispute resolution by June of the same year, Bahar highlighted a communication gap between the NBR and the attorney general’s office, emphasizing improved communication to swiftly resolve these cases stalled in higher courts.

LTU officials stated that most cases share similarities and could be resolved efficiently with appropriate action. The 860 reference cases represent over Tk 170 billion in tax disputes based on LTU data.

The tax administration filed 394 reference cases, amounting to Tk 85.40 billion in tax disputes, while taxpayers initiated 476 reference cases challenging the tax department’s claims of nearly Tk 87.20 billion.

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