Photo:BSS

DHAKA, Jan 22, 2025 (BSS) - The National Board of Revenue (NBR) has reduced Value Added Tax (VAT) on several goods and services, including medicine, mobile talk-time, internet and restaurant, considering the public interest. 

In addition to these four sectors, the VAT on non-branded clothing, has also been withdrawn, said a NBR press release issued today.

In order to strengthen Bangladesh's own financial base, the government issued the "Value Added Tax and Supplementary Duty (Amendment) Ordinance 2025" and "The Excises and Salt Act (Amendment) Ordinance, 2025" on January 9, 2025. 

For the same purpose, the NBR has issued some notifications for re-fixing the rates of VAT, Supplementary Duty and Excise Duty on some goods and services.

Considering the requests of various professional organizations, civil society and stakeholders, the NBR today issued four new notifications reducing the existing VAT rate, rate of deduction of VAT at source and supplementary duty rate on certain goods and services.

In order to make medical services more accessible to all sections of the population, the increased VAT rate at the business level on the pharmaceutical industry has been completely withdrawn and the previous rate of 2.4 percent has been maintained.

NBR mentioned that the withdrawal of the additional VAT on medicine will ensure the continued growth of the pharmaceutical industry and prevent price hikes at the consumer level. 

In order to continue the ongoing digitisation activities of the country and to create a modern IT-based young generation and increase online-based activities, the increased supplementary duty on services provided through the use of mobile phone SIM or RIM cards and the newly imposed supplementary duty on ISP services have been completely withdrawn. 

The complete withdrawal of the increased or newly imposed supplementary duty on mobile phone and ISP services will ensure that consumer expenses in these two sectors do not rise.

In order to facilitate the large population of the country to consume food in restaurants at affordable prices, the additional VAT imposed on all restaurants except three-star, four-star and five-star hotels has been completely withdrawn. 

As a result of the complete withdrawal of the additional VAT, common people will be able to consume food in these restaurants at the previous price.

The increased VAT has also been completely withdrawn in the case of motor vehicle garages and workshops. As a result of the complete withdrawal of the additional VAT, the price of these related services will not increase.
 
However, the VAT rate for non-AC hotels, sweet shops, and the sale of apparel under proprietary brands has also been reduced from 15 percent to 10 percent.

It is mentionable that, the NBR has provided extensive tax exemptions in the last few months on import duty, regulatory duty, VAT, advance income tax, and advance tax on edible oil, sugar, potatoes, eggs, onions, rice, dates, and pesticides.

 VAT exemption has also been provided for e-book services at the local supply and import levels in order to ensure easy availability of books for students at all levels of Bangladesh, to build a modern and information technology-based education system, and to improve the quality of the education system. 

VAT exemption has also been provided on the fast, safe, and environmental friendly metro rail service, which plays an important role in reducing traffic congestion. 

In addition, the NBR has completely withdrawn the excise duty on Hajj tickets in order to reduce the costs of Hajj passengers.