Electronic tax

An electronic tax system withheld at source soon to be implemented

| Update:
05 Aug 2021 09:16:41

Taxpayers could soon regularize or claim a tax credit or request reimbursement of their withholding income tax (AIT) paid under the electronic withholding system (e-TDS).

The tax administration has prepared a system to introduce e-TDS in all income tax offices in the country in the near future.

An e-TDS design and development team prepared the system integrating it with all relevant tax deduction authorities.

TDS contributes about 50 percent of the total direct taxes, or about Tk500 billion, collected by the National Board of Revenue (NBR).

Tax officials have said that the e-TDS is one of the main income tax automation jobs to ensure tax justice and control tax evasion by the deducting authority.

There are a total of 0.3 million tax deduction authorities, including government and private organizations, which are required to withhold tax at source from taxpayers and deposit it with the Treasury.

It has been found that many deduction authorities refrain from depositing taxpayer money properly, taking advantage of the manual system.

The e-TDS would check for these irregularities and ensure the transparency of the system.

Speaking to FE, Moammad Jahid Hassan, Zone-6 Tax Commissioner who leads the e-TDS implementation team, said the system is fully ready for implementation in all tax zones of the country.

“We are awaiting the approval of the NBR to introduce the system centrally for the first time in Bangladesh,” he added.

He informed that four tax zones are currently under an e-TDS pilot program.

The NBR would sign a memorandum of understanding to join the automated system of chalan (a-chalan).

Taxpayers will be able to request a refund of their tax paid, adjust their TDS when filing tax returns and claim the tax credit easily using the e-TDS system.

The system would be integrated into the A-chalan system developed by the Ministry of Finance.

With the help of a-chalan, traders can make direct payments from their bank accounts via the Bangladesh Bank’s Real-Time Gross Settlement (RTGS).

The finance division of the Ministry of Finance developed the a-chalan system as part of improving the delivery of public financial services through the implementation of the budget and accounting classification and the iBAS ++ scheme.

It is a component of strengthening the public finance management program to enable service delivery.

An AI-based import-export engine has been prepared to allow companies to adjust taxes paid in advance at the import or export stages.

The engine would be integrated into the Asycuda system of the customs service.

The NBR has completed the vulnerability assessment and penetration testing and has obtained a certificate from the Bangladesh Computer Council (BCC) in this regard.

The NBR would transfer the e-TDS system to the Bangladesh Data Center Company Limited (BDCCL) server.

It has already inserted the wildcard character SSL on the system.

Officials said there was a plan by the NBR to introduce e-TDS nationwide from this month (July 2021), but the process was delayed due to the COVID-induced lockdown and changes in senior NBR officials.

In the future, the e-TDS system would establish data sharing with the electronic declaration system to obtain information on tax deductions from the payment of wages and other sectors.

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