Income tax lawyers protest draft rule

Dhaka Taxes Bar Association staged a demonstration and besieged the National Board of Revenue (NBR) building at Agargaon in Dhaka for a couple of hours yesterday demanding cancellation of a newly announced draft tax return preparer (TRP) rule. 

They also termed it a "black law" and "harmful" for the state's revenue mobilisation initiatives.

The policy is on providing an incentive to individuals, to be named "TRPs", who would help new taxpayers file their tax return in a bid to increase compliance and narrow the gap between registered taxpayers and regular return filers.

The NBR will issue TRP certificates to people who pass a Tax Aptitude & Accounting Test. The TRPs will only help taxpayers prepare their tax returns and submit those to the tax administration online, according to the draft rule.

Several hundred income tax lawyers arrived before the NBR headquarters around 10:00am and formed a human chain to press home their demands, including allocation of space inside the building for them to set up office.

The protesters tried to enter the building around 11:15 am and, on being prevented by police and officials of the NBR, staged a sit-in on the street in front.

They also chanted slogans, demanding the resignation of NBR Chairman Abu Hena Md Rahmatul Muneem and burning his effigy.

A huge number of tax lawyers have been working in tune with the government's revenue collection efforts for a long time, said BN Dulal, the association president.

"Although we used to collect around 60 per cent of taxes without taking any incentive, the incumbent chairman is planning to recruit brokers or agents for collecting income tax without any consultation with us," he said.

The TRPs can misuse their positions in rural areas and engage in corruption, he said. "This TRPs rule…is in conflict with the Income Tax Ordinance, 1984," he claimed.

Dulal also criticised a recent minimum income tax rule and an increase in the threshold of surcharge-free net wealth.

From fiscal year 2023-24, individuals who are required to submit income tax returns to avail various government services will have to pay a minimum tax of Tk 2,000 even if they do not have taxable income.

Moreover, an individual will not have to pay any surcharge on net wealth of up to Tk 4 crore whereas earlier the ceiling was Tk 3 crore.

"It's not logical that poor people will have to pay taxes while the rich will get exemption from taxes," he said.

"The NBR chairman has created such a black law…if implemented, the image of the government will be tarnished," said Md Towhid Uzzaman Khan, the association's general secretary.

"We made some demands and the NBR chairman did not meet those…it is not acceptable. We will continue our protest until those are met," said Syed Iqbal Mostafa, the association's former president.