Central Intelligence Cell (CIC) of the National Board of Revenue (NBR) detected some sensational tax evasion cases, mostly related with the abuse of the tax holiday facility in fiscal 2005-06 and it has offered tax holiday facility to only 20 industrial units, a record low in its history.
Around 40 industrial units mainly from the textile and the pharmaceutical sectors had sought the facility in 2005-06.
The fall in the demand for the tax holiday facility has been attributed to omission of the readymade garment sector from the package and the mandatory requirement of 10 per cent investment in the county's share market from annual profit by the industries enjoying tax holiday facility from the 2005-06 fiscal.
NBR brought the changes in the last fiscal when it decided to extend the continuation of the facility until 2007-08 fiscal amidst criticism from the different quarters.
The tax holiday facility costs the government Tk 140 billion in revenue income during the last 30 years.
Government allows various incentives including zero tariff facility to local and foreign investors under the tax-holiday package for a certain period.
An industry can enjoy the incentives under the tax-holiday package for five years in Dhaka and Chittagong, seven years in less developed places of the country and 10 years in Export Processing Zone (EPZ) areas.
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