Staff Reporter :
Multinational technology companies are siphoning off significant sums of money from Bangladesh through online advertising, according to the latest financial data.
Platforms like Facebook, Google, Amazon, and Microsoft have been raking in millions of dollars annually from the country.
However, the most popular social media platform in Bangladesh is currently Facebook.
Through 15-second advertisements while scrolling, multinational Facebook quickly takes money out of the country.
It’s not just Facebook – other multinational tech companies like Google, Amazon for cloud computing, Microsoft, Zoom for video streaming, LinkedIn, and Dropbox are also taking money out of the country.
In the 2023-24 fiscal year, 18 VAT-registered companies earned approximately Tk 833.86 crore (8.34 billion) from Bangladesh through advertisements.
These multinational companies took an average of Tk 69.48 crore per month from the country, which amounts to about Tk 2.31 crore daily.
Of this, Facebook alone took Tk 318 crore, and the government collected about Tk 124 crore in VAT from this revenue in the last fiscal year.
However, allegations suggest that the government does not collect VAT on online advertisement payments made outside the banking channels.
The National Board of Revenue (NBR) lacks the capability to monitor online advertisements, forcing them to rely on the data provided by the companies.
Experts believe that if monitoring were possible, the government could collect even more VAT from virtual world advertisements.
According to NBR, in the 2023-24 Fiscal Year, 18 non-resident VAT-registered companies paid VAT on their earnings and submitted returns.
Two more companies have registered for VAT this year – Google Digital Inc. and Paddle.com Market.
The 18 non-resident companies include two branches of search engine Google, namely Google Asia Pacific Pte. Ltd. and Google Ireland Ltd.
Facebook’s three entities are Facebook Ireland Ltd., Facebook Payments International Ltd., and Facebook Technologies Ireland Ltd.
Other companies include Netflix Pte. Ltd., Amazon.com Services, Amazon Advertising LLC, Amazon Web Services Inc., LinkedIn Singapore Pte. Ltd., Zoho Corporation Pte. Ltd., Zoom Video Communications Inc., Microsoft Regional Sales Pte. Ltd., Turnitin India, Proxima Beta Pte., University of London UK, Dropbox International Ireland, and The Rocket Science Group LLC.
Lack of online advertisement monitoring capabilities:
According to sources, the NBR or VAT office lacks the capacity to monitor how many advertisements companies have placed on platforms like Facebook, Google, or Microsoft.
As a result, VAT offices rely on the income figures these companies declare in their monthly returns to collect VAT.
There are allegations that many local companies place ads in the virtual space of these platforms, but the payments for these ads are made outside the country.
As these payments are not processed through banking channels in Bangladesh, the government cannot collect VAT from them.
Furthermore, some domestic advertisements are also not paid through banking channels.
Additionally, popular video streaming platform YouTube has not yet registered for VAT in Bangladesh, even though many local companies advertise there, depriving the government of VAT from these entities.