The revenue authority plans to buy a total of 300,000 sales monitoring devices this fiscal year to bring all shops under an online network and cut the scope for VAT evasion. The government already gave approval to purchase 100,000 such electronic fiscal devices (EFDs) for Tk 316 crore ($37.5 million) from a consortium led by Shenzhen-based SZZT Electronics. The National Board of Revenue (NBR) has awarded the contract to the consortium, which was the lowest bidder in a tender floated to buy the devices. The consortium, which also comprises local firm Synesis IT, offered to supply the devices at Tk 32,000 each, Finance Minister AHM Mustafa Kamal told reporters after the decision to buy the devices from the consortium was finalised. “We have already issued the Notification of Award to purchase one lakh EFDs,” said Syed Mushfequr Rahman, project director of the NBR’s VAT online project. The Tk 690-crore project aims at automating the VAT system and is also assigned to oversee the establishment of the sales monitor—an EFD management system—which will connect the devices at sales points with the revenue authority through internet. Rahman said the NBR would initially receive 10,000 devices from the bidder and the delivery of the rest would be taken upon successfully installation of the first tranche.
“We expect to get the delivery within the next six to eight weeks,” he said, adding that the NBR has decided to buy 200,000 more EFDs this year. The revenue board has submitted a proposal to the cabinet committee on purchase seeking approval to buy one lakh more EFDs from another technically qualified bidder. “We have placed the proposal for the direct purchase. We will buy one lakh more EFDs from one of the two other bidders if they agree to supply the devices at the lowest prices quoted by the winning bidder,” Rahman said. “We have to get the EFDs quickly so we are going to buy directly.” Two bidders—the consortiums of Inspur and Technovista and Daisy and Smart Technologies–emerged technically qualified in the bidding, but their quoted prices were higher. Another Tk 316 crore will be required to buy 100,000 more EFDs. The rest one lakh devices would be purchased later. The plan to buy the devices in higher quantity is aimed at bringing stores under the electronic network, monitoring their sales activities and boosting tax receipts. To do so, 30-40 lakh EFDs are required, Rahman said. The government is yet to decide on how to realise the cost of purchasing the EFDs from shop operators. The finance minister earlier said the devices would be provided to shops at Tk 32,000 and they would pay back in instalments. Two years ago, the NBR decided to buy the devices and distribute them among relatively large retailers as well as wholesalers in order to implement the VAT law 2012, which came into effect in July this year. VAT is the biggest source of revenue for the government, accounting for 37 percent of the total annual tax collection. But taxmen and economists say the overall collection is less than the amount expected, given the level of economic activities in Bangladesh. The country, despite registering higher economic growth, collects in tax less than 10 percent of $300 billion GDP. The tax-to-GDP ratio of Bangladesh is one of the lowest in the world.
Source – The Daily Star.
