Muhith rejects demand for VAT reduction

Staff Correspondent | Published: 00:12, Nov 11,2016

 
 

Finance minister AMA Muhith, National Board of Revenue chairman Nojibur Rahman and Dhaka Chamber of Commerce and Industry vice-president Atiqu-E-Rabbani are seen along with others at the launching ceremony of the Tax Guide 2016-17 published by the DCCI at the finance ministry conference room in Dhaka on Thursday. — PID photo

Finance minister AMA Muhiuth on Thursday rejected the Dhaka Chamber of Commerce and Industry’s demand to reduce t Value Added Tax.
During a meeting with the e DCCI representatives at his secretariat office Muhith said that the government would stick to its decision to realize VAT at the flat rate of 15 per cent from the next year.
On November 2, the capital’s small businessmen and shop owners announced that they would intensify their movement from November 20 unless VAT was reduced.
At the meeting with the finance minister a DCCI delegation led by vice president Atiqu-E-Rabbani demanded that VAT collection at the flat rate of 15 per cent should not be introduced from the next fiscal to protect manufacturers and small traders from ruin.
DCCI leader Alauddin Malik pointed out to the finance minister many apparel manufacturers from whom VAT was collected four ties would have to pay 60 per cent VAT if its rate was set at 15 per cent from the coming fiscal.
Muhith rejected their method of accont keeping and advised merchants to rectify their accounts with regard to VAT they pay.
Since 2012, the National Board of Revenue had to defer VAT collection at the flat rate of 15 per cent time and again due to opposition of businessmen.
A new VAT law enacted in 2012 stipulates VAT collection at the flat rate of 15 per cent.
In the current fiscal, the NBR raised the lowest ceiling of VAT for small merchants to Tk 7,000 from Tk3,500.
The maximum VAT ceiling for small businessmen has been raised to Tk 28,000.
The upper and the lower VAT ceiling for small merchants were set under a special package for them which has been drawing protests from the shopkeepers as well as small merchants.
During Wednesday’s day-long strike in the capital, shop keepers and small businessmen pressed the demand for lowering the rate of VAT for them.
VAT was introduced in Bangladesh in 1991.
NBR chairman Nojibur Rahman who attended the meeting said the VAT number of businessmen would be registered using a new software. 

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