The National Board of Revenue (NBR), has extended the deadline for filing VAT returns for July and August by another 10 days, just three days after returning to the system of monthly submissions.
The revenue authority had initially given businesses 15 days to submit the returns for the two months, setting Oct 15 as the deadline. It has now extended the deadline to Oct 25.
Businesses filing their returns within the extension period will not have to pay any interest or penalties, according to a fresh order issued by the NBR on Thursday.
Explaining the decision, the tax authority said “some administrative adjustments” to the e-VAT system were necessary following the return to monthly VAT filings.
At the start of the current fiscal year, the government introduced a system allowing businesses to file value-added tax, or VAT, returns every three months instead of monthly, in a move aimed at providing them some relief. Previously, businesses were required to submit returns every month.
However, without monthly returns, the authorities were unable to obtain data on how much VAT was being collected each month from the government’s largest source of tax revenue.
NBR officials had also been saying that VAT collection was showing a negative trend.
Against this backdrop, the NBR moved to restore the monthly VAT return system. A draft ordinance to this effect received both in-principle and final approval at a Cabinet meeting chaired by Prime Minister Tarique Rahman.
The draft amendment to the Value Added Tax and Supplementary Duty Ordinance says taxpayers currently have 15 days after the end of every three tax periods, or three months, to file VAT returns.
Under the revised provision, VAT returns will have to be filed within 15 days following the end of each tax period, or every month.
Three days after the change, the NBR on Oct 1, also asked businesses to file VAT returns for July and August.
Meanwhile, with VAT collection remaining in negative territory, the NBR has yet to publish revenue collection data for any month even three and a half months into the new fiscal year.
The further 10-day extension for filing the July and August VAT returns means updated monthly revenue figures may remain unavailable even after four months of the fiscal year.