CNG traders demand taxation on profits and not on sales

News Desk: Compressed Natural Gas (CNG) traders have claimed to be in a difficult situation as the rate of turnover tax is higher than the profit. Bangladesh CNG Filling Station and Conversion Workshop Owners Association, an organization of businessmen in this sector, demanded to set a tax on profits instead of setting a turnover tax on total sales to sustain the business.

This information has been revealed in an application submitted to the chairman of the National Board of Revenue (NBR) on May 2.

The secretary general of the organization Farhan Noor said, currently we buy gas at 35 taka per cubic meter set by the government and sell it to customers at 43 taka. I get only Rs 8 commission or profit by selling gas per cubic meter. With which all expenses such as salaries of officers and employees, electricity or gas bills, various license fees, maintenance costs of equipment have to be met. But the government is deducting turnover tax at the rate of 10.5 percent on our gross sales. We are suffering from this, it is difficult to sustain the business now. So our demand is to fix turnover tax on profits. I have been making this demand for a long time.

According to the source of the letter, it is also known that after buying feed gas for their business, CNG traders compress it and sell it at the price set by the government. As a result, the profit between purchase and sale is the commission of traders in this sector. While it is reasonable to levy turnover tax on commission or margin, the income tax office is levying turnover tax on the full sale price.

Traders complain that the turnover of CNG traders has increased due to increase in gas prices at different times, but the profit remains the same. As a result, traders have to pay more turnover tax than profits - which they feel is completely unreasonable. The sales price is not the whole money earned by the traders, the traders in this sector get only a margin.

Traders feel that it is reasonable to set a turnover tax excluding the feed gas price of Rs 35 fixed by the government. They demand that the turnover tax be determined by measuring the total cubic meter of gas sold as per bill paid at the rate of 8 rupees per cubic meter.

 

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