NBR Chairman Muhammad Abdul Mazid (3-L) addresses the members of Metropolitan Chamber of Commerce and Industry (MCCI) in the capital yesterday. Photo: MCCI

Hinting at reduction in discretionary power of VAT (value added tax) and customs officials, the NBR (National Board of Revenue) chairman yesterday assured business leaders of making his department more taxpayer-friendly from next fiscal year.
Pointing to the fact that the income tax officials has now less discretionary power as the current national budget endorsed reduction in such power of them, Muhammad Abdul Majid said, "If everyone goes by transparency, we need not to keep much stringent provisions in the taxation system."
Majid's remarks came at a meeting organised by the Metropolitan Chamber of Commerce and Industry (MCCI) in Dhaka.
The chamber leaders told the NBR chief that the taxation system has been marred by administrative discretions.
They lamented that the NBR's reform programme has been lying unimplemented for many years and a faulty taxation has sometimes led to a large scale tax evasion.
Among other things, the issues relating to the country's economy came up for discussion at the meeting, chaired by MCCI President Latifur Rahman.
Mahbubur Rahman, president of the International Chamber of Commerce-Bangladesh, Mohammad Alam, member (VAT), Ali Ahmad, member (Income Tax) of NBR, C. K Hyder, secretary general of MCCI and other members of MCCI were present.
During the meeting, the NBR chairman spelt out his desire to make the board more business-friendly so that the private sector can play a vital role in executing government policies.
He said, "We don't want to be isolated from each other."
The NBR chairman believes that private sector stockholders' opinion should be reflected in the fiscal policy.
Keeping this in mind, the NBR for the first time is going to organise the yearly pre-budgetary consultation with the private sector much earlier than the usual.
Majid said," We are contemplating to organise budgetary discussions for the next fiscal budget by December or January so that the government policymakers could have enough time to examine the fiscal suggestions coming from the private sector."
He cited an example of Japan where members of the business community plays a vital role in implementing their government's policies by conducting massive research works on trade- related issues.
He urged the MCCI leaders to conduct more research to become a major part of the national policymaking.
The NBR chief could not help expressing his anticipation that this fiscal faces a tough time ahead as the recent cyclone after two spell of floods must hit the rice production.
He feared a 13 lakh-tonne shortfall in rice output this fiscal year.
Under this circumstance it may be difficult to achieve revenue target for the current fiscal, he said, adding that bank borrowing might be increased due to food shortage.
He, however, said NBR will try its best to earn the targeted revenue and hence the business community's support must be ensured.
MCCI President Latifur Rahman urged the NBR to switch over to the pre-2000 amendment position of Section 11(1) (2) and 12 (2) so as to include judicial members in the tax tribunal benches.
Drawing the NBR chairman's attention to some anomalies in the Clean Report of Findings (CRFs) issued by the pre-shipment inspection (PSI) firms, he said, "We firmly feel that CRFs issued by the PSI firms should form the basis of tariff assessment as laid down in the PSI scheme."
The metropolitan chamber chief, however, advocated continuation of the PSI scheme.
Stressing the need for rationalising the penalty provision for the PSI firms, he said the existing penalty provisions are too inadequate to enforce discipline so as to stop false or incorrect certifications.
Replying to a query about the PSI firms, NBR Chairman Mohammed Abdul Majid pointed out that every sector has merits and demerits.
"So it would not be rational if we make decision on a certain sector considering its demerits only," he said.
He, however, said the NBR wants to examine whether the services of PSI companies would be required on expiry of the deal between the government and the PSI firms in August 2008.
Full discriminatory power of the superintendents should be withdrawn and suitable opportunity be given to VAT payees through notices so that the concerned matter can be explained satisfactorily, MCCI President Latifur Rahman said, underlining the need for suitable amendment to the related law in the next budget.