The National Board of Revenue has decided to provide manual business identification number (BIN) to global technology giants, including Google, Facebook and Youtube, as its online system is yet to be ready to issue e-BIN to foreign entities without any office in Bangladesh. The decision came after the revenue board failed to bring the global social media giants and technology companies under its VAT net in more than one year due to procedural complexities and lack of preparation. The NBR imposed 15 per cent value-added tax on the digital services, including advertisements, offered by the companies not having offices in Bangladesh from July 1, 2019. The tax authorities also asked the companies to obtain BINs and appoint VAT agents locally to maintain VAT-related documents and records and payment of VAT. But so far none of the entities has obtained BINs, known as VAT registration numbers, as the revenue board failed to finalise required rules and amend forms. In this context, the NBR’s VAT policy wing in a meeting held on July 23 decided to issue BIN manually to the companies as more time is required to amend the rules and forms while the VAT Online Project also needs time to prepare its system to issue e-BINs to such entities. Currently, a company must have physical address and provide bank accounts to get electronics BIN or e-BIN. The NBR will issue an order to provide manual BINs for interim period to the non-resident entities not having physical presence in Bangladesh to ensure proper VAT collection from the sector, a senior NBR official said. He said that the NBR would also issue order so that the companies could obtain BINs using the postal code of related divisions and circles of Dhaka (South) VAT commissionerate as the companies were located outside Bangladesh’s geographical territory. By this time, the VAT policy wing will frame draft registration form and take steps to bring necessary amendments to the related sections of the VAT rules and forms to make the rules and forms compatible with non-resident entities, he added. The existing forms are designed for companies having offices in the country. The government and the revenue board, however, have been requesting the tech giants to set up offices in Bangladesh and operate economic activities from here, officials said. None of the licenced VAT agents, most of which are globally renowned accounting and consultancy firms, have showed interest to be agents of the global social media giants as they would have to take all liabilities, individually and jointly, for payment of VAT, penalty and other taxes and would be responsible for any possible VAT evasion by the companies, they said. Global tech companies are also reluctant to share their confidential information with the local VAT agents. Regional offices of Google, Facebook and Microsoft have also been requesting the NBR to bring in the required amendments to the law and seeking clarifications of the law so that they could obtain BINs on their own and pay VAT directly instead of appointing a local agent. So, the NBR is considering allowing the non-resident entities to obtain BINs directly without help of the agents, the officials said. They said that the process of obtaining BINs would be simplified for the companies. They, however, said that though field offices were getting revenue from the sector as banks deduct 15 per cent VAT at source while remitting the money from the country, they could not monitor the sector and determine the actual payable in absence of VAT registration of the firms.
