Consequences of Failure in Tax Deduction & Collection | Section 143, Income Tax Act 2023 (Bangladesh)
Where any person, under the provisions of this Part—
(a) fails to deduct or collect tax at source; or
(b) deducts or collects tax at a lower rate or amount; or
(c) after deducting or collecting tax at source, fails to deposit it to the credit of the Government, or deposits an amount less than what was deducted or collected; or
(d) fails to comply with any other provisions,
such person shall be deemed to be a defaulter.
Without prejudice to any other consequences under this Act, a person deemed to be a defaulter under sub-section (1) shall be liable to pay the following amounts, namely—
(a) the amount of tax not deducted or collected;
(b) the difference between the amount required to be deducted or collected and the amount actually deducted or collected;
(c) the amount deducted or collected but not deposited to the credit of the Government; and
(d) in case of failure to comply with any other provisions, an amount not exceeding BDT 10 lakh.
In addition to the amounts payable under sub-section (1), a defaulter shall also be liable to pay an additional amount at the rate of 2% per month on the base amounts mentioned in clauses (a), (b), and (c) of sub-section (2), calculated as per the following table:
| Sl. No. | Situation | Basis for Additional Amount |
|---|
| 1 | Failure to deduct or collect tax | Amount of tax not deducted or collected |
| 2 | Deduction or collection at lower rate or amount | Amount of shortfall in deduction or collection |
| 3 | Failure to deposit or short deposit after deduction/collection | Amount not deposited to Government |
The period for calculating the additional amount under sub-section (3) shall be from the due date of deduction or collection to the date of deposit to the Government treasury:
Provided that such period shall not exceed 24 months.
The Deputy Commissioner of Taxes shall, after giving the person a reasonable opportunity of being heard, take necessary steps to recover the amounts payable under sub-sections (2) and (3).
In cases involving Government, government institutions, authorities, projects, programs, organizations, units, or any activity having financial or administrative involvement of the Government, the following persons shall be jointly and severally liable for payment of tax, penalty, and additional amounts—
a) persons responsible for approving or authorizing payments; or
(b) persons responsible for issuing clearance, registration, license, permit, approval, or authorization.
In cases other than those mentioned in sub-section (6), where any person or entity is responsible for deduction or collection of tax
(a) the person or entity itself; and
(b) the persons responsible for approving or authorizing payments,
shall be jointly and severally liable for payment of tax, penalty, and additional amounts.
