Sadharan Bima Corporation (SBC) may face legal action, including account forfeiture, by government's revenue authority over unpaid corporate tax worth Tk 2.0 billion, officials said.
The National Board of Revenue (NBR) might be compelled to attach bank accounts of the state-owned insurance entity for collecting the arrears in income tax that have accumulated since 1990.
The Large Taxpayers Unit (LTU) under the income-tax wing of the revenue board served final notice to the SBC recently having failed to get satisfactory response from the corporation despite several reminders.
Officials said as per the final notice the last date for payment of the unpaid tax expired on March 13, 2017.
In the letter, the LTU warned action under section 143 of the income tax ordinance 1984.
As per the income-tax law, the tax authority can collect its due tax through attachment of bank accounts of a tax defaulter. In that process, they collect the arrears direct from bank accounts of such taxpayers.
The LTU audit wing has counted the arrears in income tax worth Tk 2.08 billion after assessment of tax files of Sadharan Bima Corporation from tax year 1990-91 to 2013-14.
The LTU had served notice to the corporation but the income-tax consultant of the corporation applied for some two months time, until May 02, 2017, for payment of the arrears.
However, the LTU declined to allow an additional two months "for the sake of revenue collection".
Officials said state-owned entities should be tax-compliant to encourage private sector to pay taxes.
Talking to the FE Wednesday, a senior official of the SBC said the corporation is a tax-complaint entity by regularly paying tax and VAT.
"The amount of arrears in tax has been identified after assessment of tax file of the SBC. We are also examining the tax liability and responding to the tax authority's notices accordingly," he said.
Tax officials said arrear amount of revenue is one of the big headaches of the NBR. Around Tk 300 billion worth of tax revenue remained stuck-up with court cases. Of the revenues, state-owned entities owe a significant part as income tax and Value Added Tax (VAT).
They said government organizations can resolve the dispute through Alternative Dispute Resolution (ADR) as out-of-the-court settlement can also expedite revenue collection through mutual understanding.