Staff Reporter :
An inter-ministerial meeting is scheduled for today (Wednesday) to address the longstanding issue of value-added tax (VAT) dues worth over Tk 22,000 crore owed by the Bangladesh Petroleum Corporation (BPC) to the National Board of Revenue (NBR).
As per the demand notice issued by the NBR, four marketing companies under the BPC umbrella, namely Padma Oil Company, Meghna Petroleum, Jamuna Oil, and Standard Asiatic Oil Company, have been collecting VAT from consumers for fuel supply but have only partially deposited it with the public exchequer.
Officials have indicated that the revenue board has been exerting pressure on the corporation to find solutions to settle the outstanding dues, especially in light of significant revenue shortfalls against the targets.
Over the past six years, the BPC has struggled to fulfil its VAT and supplementary duty (SD) obligations, amounting to over Tk 22,000 crore, primarily due to financial constraints.
In an effort to address this issue, the Energy and Mineral Resources Division (EMRD) had previously urged the Finance Division to convene an inter-ministerial meeting focusing on book adjustment.
In addition to the aforementioned developments, EMRD has facilitated the organisation of an inter-ministerial meeting set to convene in its conference room at the secretariat on Wednesday.
Heading the meeting will be EMRD Secretary Md Nurul Alam, with the presence of Finance Division Secretary Md Khairuzzaman Mozumder and Large Taxpayers Unit (LTU) VAT Commissioner Shamsul Islam.
As per a memorandum letter drafted by the EMRD for the former senior secretary of the finance division, the state-owned company finds itself unable to settle dues amounting to Tk 20,033 crore to LTU, VAT under the NBR, until July of the previous year. NBR officials have indicated that this figure has since ballooned to approximately Tk 22,000 crore with accrued interest.
The state-owned company attributes its financial shortfall to several factors, including inadequate income, depleted funds, the costly importation of liquefied natural gas (LNG) with subsidies, and substantial annual losses attributed to alleged system losses and corrupt practices within its ranks.
Despite EMRD’s request, dated September 23, 2020, urging necessary fund allocation in favour of Petrobangla or payment through book adjustment in line with NBR’s recommendation, the Finance Division has yet to take any action, as noted by Petrobangla officials.
LTU officials have continued to press Petrobangla for a swift resolution to this matter.
Even at the 38th meeting, the parliamentary standing committee on the Ministry of Power, Energy, and Mineral Resources was informed about necessary measures to reconcile all dues of Petrobangla to LTU VAT on the price of gas sold as per the decision taken at inter-ministerial meetings.
In a meeting held on March 14, 2017 with the former finance minister in the chair, it was decided that after completing the audit by the Office of the Comptroller and Auditor General, the Finance Division would take the necessary measures to clear outstanding dues through book adjustments. Officials from both ends, including NBR and EMRD, said that after a notable meeting there, there is still no discussion yet to see light.
However, both parties are hopeful now as the incumbent finance division secretary was EMRD secretary and he was in the NBR as customs cadre service. So, Khairuzzaman Mozumder is aware of everything, and he can resolve the matter easily, officials said.