DHAKA: National Board of Revenue (NRB) has taken decision to collect tax at source from the foreign consultancy firms engaged in several development projects in the country.

These firms will have to pay 5 percent tax at source either before the signing the project deals or during the collection of bills after the implementation of the projects.

NBR will take steps to collect taxes from the foreign companies.

The income tax department of the NBR has already ordered the foreign firms engaged in several development projects including in the projects of Bangladesh Power Development Board (BPDB) to pay tax at source.

Directives can be passed shortly to call the foreign consultancy firms to submit the project details as well as to pay source tax.

According to the sources, payment of the tax at source is going to be made compulsory.

If the government exempts the firms from tax pay according to the deal, the companies will pay the source tax from its own fund.

According to the income tax law in 1984, consultancy firms have to pay 5 percent of Advance Income Tax (AIT). Source tax will be paid with AIT. It will also be paid from the project fund during the payment of bills to the firms.

An NBR official on condition of anonymity told banglanews that the foreign companies usually avoid source tax showing different excuses. But the local companies have to pay the tax.

The foreign companies evade taka hundreds of crores as tax evasion, he added.

According to the member, if tax is collected from the foreign companies, the country will earn several hundred crores of taka as revenue.

A gazette is expected to be issued shortly regarding this matter, he added.

BDST: 1521 HRS, AUG 21, 201