National Board of Revenue (NBR) chairman Md Abdur Rahman Khan on Monday said the government would try to introduce single rate VAT system in the country to reduce the leakage in revenue collection. Speaking at a press briefing marking VAT Day 2024, he emphasized the importance of expanding the VAT net and rationalizing tax exemptions to address the country’s economic challenges. “A single rate VAT system will not only reduce leakages but also make administration much easier. We are definitely working towards that goal,” Khan said during the event at the NBR conference room. This year’s VAT Day is themed, “We all will pay VAT and contribute to development.” The NBR chief highlighted plans to gradually phase out VAT exemptions while consulting stakeholders. “It does not mean that this has to be done right now. We will do that after consultation with the stakeholders,” he said. NBR plans online tax reforms to simplify process for taxpayers Khan expressed concern over the low number of registered VAT payers—currently just over 500,000—despite a significant number of eligible businesses operating outside the system. “The VAT net is still very narrow, leaving enormous room for expansion. We need to bring non-compliant businesses into the fold and expand the tax base urgently,” he said. The NBR has committed to intensifying supervision and targeting non-VAT-paying businesses. “Expanding the VAT net is crucial to bridging the revenue collection gap, especially as we face a shortfall in the first five months of the fiscal year,” he explained. The NBR chairman acknowledged the ongoing economic crisis and emphasized the importance of strengthening revenue collection to support recovery. “If we want to recover from the economic crisis and move forward, there is no alternative to increasing tax revenues,” he said, urging VAT officials to work with honesty and diligence. He also pointed to the impact of widespread tax waivers on revenue collection in recent months. “While tax waivers were introduced to benefit the masses, they have significantly affected revenue. We must reduce tax waivers and rationalize exemptions as the economy improves.” The NBR chairman outlined the agency’s efforts to create a robust and fully online VAT system. “We have automated VAT registration, filing, and payment systems and are now focusing on introducing an e-invoice system to eliminate flaws and improve efficiency,” he said. The shift from paper-based processes to digital systems aims to simplify procedures for stakeholders, encouraging broader participation. Additionally, VAT rates on essential goods like sugar, eggs, potatoes, and edible oil have been reduced in response to current economic realities, while excise duties on Hajj passenger tickets have been waived. He reiterated the NBR’s commitment to fostering a business-friendly environment and strengthening the country’s tax culture. “By involving consumers, traders, and industrial owners, we aim to build a Bangladesh of dreams—one that is inclusive and free of discrimination.” “The success of the VAT system depends on the widespread participation of stakeholders. It is hoped that all these promotional activities will be quite helpful in building a tax culture in the country, which will contribute to increasing VAT collection in the future. The desired development will be achieved in its continuation. We will become a happy, beautiful and prosperous country,” said the NBR chairman.

The import-level value-added tax (VAT) on edible oil has been reduced from 10 percent to 5 percent to maintain a steady supply in the market. The National Board of Revenue (NBR) issued a notification in this regard on Tuesday. Earlier, the NBR had issued exemption notifications to boost the supply of rice, potatoes, onions, eggs, edible oil and sugar in the market. Read: Govt to procure 55,000 MT soybean oil for OMS On October 17, 2024, to keep oil prices within the purchasing power of the general public, a 15 percent tax exemption was allowed at the local production level, while a 5 percent VAT was imposed at the local business level on the supply of refined and unrefined soybean and palm oil. As a result of this exemption, only a 5 percent VAT is currently applicable at the import level. The NBR says that the removal of the said VAT will help maintain edible oil prices at a manageable level in the market, ensuring that consumers do not face increased costs. This exemption on edible oil will remain effective till December 15, 2024.

The National Board of Revenue (NBR) on Thursday issued a gazette notification exempting import duty on sugar and eggs, and import and local VAT on edible oil to increase supply and rein in the prices of these essential commodities. According to an NBR press release, the existing import duty on eggs has been reduced from 25 percent to 5 (five) percent – which will reduce the price of eggs by Tk 13.80 per dozen at the import stage. Govt slashes VAT on import of edible oil Due to the reduction of import duty, the supply of eggs in the market will increase and the price of eggs will be reduced at the consumer level, so it will be more affordable to general consumers, the NBR hopes. It also said that the costs of egg-using industries such as confectionery, bakery, egg-based food producing industry will be cut, returning “relief and balance” to the market. This facility will remain in force till December 15, 2024. In the case of supply of refined soyabean oil and refined palm oil, the NBR press release said that 15 (fifteen) percent VAT imposed at the local production level and 5 (five) percent at the local business level has been exempted and the import level VAT has been fixed at 10 (ten) percent instead of 15 (fifteen) percent for the import of crude soybean oil, crude palm oil, other including refined palm oil and refined soybean oil. Due to the reduction and withdrawal of value added tax at the import stage and at the local level, it will be possible to keep the price of this essential commodity at a tolerable level in the market despite the increase in the price of edible oil in the international market, the NBR said. This facility of edible oil will remain in force till December 15, 2024. On October 8, the existing regulatory duty on refined and unrefined sugar was reduced from 30 percent to 15 (fifteen) percent. The National Board of Revenue (NBR) has reduced the import duty on refined sugar from Tk 6,000 to Tk 4,500 per metric ton within a week to increase the supply of refined sugar in the market. Due to the significant reduction of import duty and regulatory duty on refined sugar, the supply of refined sugar will increase in the market by increasing the import of refined sugar and it will be possible to keep the price of sugar at a tolerable level, the NBR said.

The government on Thursday reduced the Value Added Tax (VAT) on import of soybean and palm oil to 10 percent from existing 15 percent. The National Board of Revenue (NBR) issued two separate notifications reducing VAT on imports, processing and trading of soybean and palm oil. Traders propose waiving duties on soybean, palm oil imports It also exempted VAT at production and trading of the highly import-based edible oil. As per the notifications, the reduced VAT will remain effective until December 15 of this year. PROGGA urges ban on sale of loose edible oil in unhealthy drums On October 9, the NBR reduced the regulatory duty on both refined and raw sugar imports from 30 percent to 15 percent aiming to make sugar prices more bearable for consumers.

Traders have proposed increasing the prices of edible oil by Tk 10 per litre as the tax exemption deadline on it expired on April 15. Bangladesh Vegetables Oil Refiners' and Vanaspati Manufacturer's Association (BVORVMFA) sent a letter to the senior secretary of the commerce ministry in this regard on Monday. The letter was issued by executive officer of BVORVMFA Nurul Islam Mollah. Dhaka district receives lion's share of remittances so far in current fiscal: BB Report The letter stated that as tax exemption on the import of raw materials and production of edible expired on April 15 so it will be supplied at the prices fixed before the exemption of VAT. As per new rate, a litre bottle of soybean oil will be sold at Tk 173, while 5 litre bottle at Tk 845 and a litre palm oil at Tk 132. In February the National Board of Revenue reduced  the Value Added Tax on refined and crude (non-refined) soybean and palm oil to 10 percent from 15 percent. However, state minister for commerce Ahasanul Islam Titu at a meet the press at Dhaka Reporters ‘Unity on Tuesday said there is no scope to hike prices of edible oil. All factories have paid March salaries and Eid bonuses: BGMEA President He said the edible oil price can be adjusted with the international market rate but it will take time. The state minister also said the price hike would be considered on the import of new shipment of the edible oil.

Aiming to significantly boost revenue collection from domestic sources, the National Board of Revenue (NBR) is adopting a three-pronged approach. These are: digital transformation, expansion of tax net, and enhancing administrative capacity. The core idea is to make tax payments easy and transparent to improve taxpayer services which in turn will help NBR to collect more revenue, according to an official document. According to the Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26) of the Finance Division of Finance Ministry, the government has taken some Major reform measures to materialise the move. The VAT & Supplementary Duty Act 2012 has been implemented in July 2019. With the implementation of the new act, the collection of VAT and supplementary duty is expected to receive a significant boost in the medium term. After the initial hiccup and the shortfall due to the outbreak of COVID-19, revenue collection accelerated in FY22. The government has enacted the new Customs Act, which replaced the Customs Act 1969. International best practices in customs, including that of the World Customs Organization (WCO), the revised KYOTO Convention and the WTO Trade Facilitation Agreement have been incorporated here. NBR will go after house and flat owners for not filing returns; NBR Chairman The law aims to harmonise and simplify customs processes to facilitate the collection of custom duties. The new Income Tax Act is also expected to create an enabling environment for taxpayers, streamline income tax assessment and collection, and facilitate domestic and foreign investment. To implement the new VAT law, the NBR undertook the ‘VAT Online Project (VoP)’ which was in operation since 2013 and concluded in June 2021. Under the VOP, the official document said that the three important automation measures have been completed. First, the Online VAT Registration began in March 2017. Again, the central registration system has been in force since July 2019. The NBR has introduced online return submission in July 2019. The digital filing system has been introduced in the form of online submission of VAT returns. The NBR has rolled out the electronic payment (e-payment) of customs duties in 2017, income tax in 2012 and VAT in 2020. Income tax can be paid through MFS (mobile financial services) as well. To facilitate real-time deposit of government money to the national exchequer, the government has launched the Automated Invoice Portal. This Automated Challan (also known as A-Challan) will act as the receipt window of the government. The payment of income tax has already been brought under the A-Challan system on a pilot basis. The NBR now plans to expand its use for payment of VAT and customs duties. The A-Challan will ensure the timely deposit of money including the prevention of fake return submission and revenue evasion.Moreover, the discrepancy between the amount of revenue collected by the NBR and the accounts given by the Accounting Offices will be eliminated. The Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26) said that individual taxpayers can now submit their tax returns online. NBR extends deadline for filing companies’ tax returns to April 30 The NBR has successfully launched eTDS Environment for easy and hassle-free processing of income tax at the source. With the introduction of this system, taxpayers’ time, cost and visits have been reduced to almost zero. Taxpayers can now submit fourteen reports in the eTDS environment. To stop evasion in VAT and enhance VAT collection, the government has introduced Electronic Fiscal Devices (EFD) with a sales data controller mechanism. The government has already installed 9270 EFD/SDC (Sales Data Controller) machines. NBR has selected 24 sectors, including residential hotels, bakeries and fast foods, decorators and caterers, sweet shops etc. for this purpose. To broaden the coverage, the government has decided to outsource the installation of EFD/ SDC machines with a target of 60,000 EFD/ SDC in the first phase and 3,00,000 in five years, if the first phase brings good results. Besides, to prevent tax evasion and to bring transparency in VAT record keeping, the government has made the use of NBR-prescribed VAT software mandatory in VAT-registered industries with annual turnovers of Tk 5 crore or above. The NBR has made provisions to enable internet-based companies, such as Google, Facebook, Microsoft etc. to pay their VAT on online sales. This allows these companies to pay their VAT through their authorised VAT agents without opening their office in Bangladesh. The NBR plans to operationalise the risk management system to ensure that no more than 10 percent of the import consignments are subject to physical examination. To that end, the NBR has established a Central Risk Management Unit/Commissionerate for Customs. To streamline the bonded warehousing system, reduce its misuse and make it transparent, the government has taken a project that aims to automate the bond management system by June 2023. Meanwhile, the licensing module has started operation and other modules will become operational soon. Bangladesh Customs will soon be conducting a Time Release Study in the major custom houses to take stock of the actual time taken in the release of imported consignments. The objective of the TRS will be to identify bottlenecks in customs clearance and to take measures to reduce clearance time. The NBR strives to expand the number of taxpayers and has made the return submission mandatory for all TIN-holders with a few exceptions. Other reform efforts by the NBR included – i) implementation and activation of Online National Single Window, Post Clearance Audit, Advance Ruling, Authorised Economic Operator, and thereby increasing dynamism in international trade; ii) full implementation of online income tax return submission under SGMP project; iii) implementation of “Individual Source Tax Deduction Monitoring Zone” to strengthen income tax deduction monitoring; iv) expansion of the e-Payment system in income tax; v) activation of transfer pricing and anti-money laundering activities; and vi) strengthening ICT infrastructure construction and automation activities. Administrative expansion of the income tax department is underway, the Medium Term Macroeconomic Policy Statement added. Introduction of the Document Verification System (DVS) has brought financial discipline and positively contributed to boosting tax collection both in income tax and VAT by increasing transparency. NBR collects nearly Tk 2 lakh crore in 7 months, growth over 15%

The government of Bangladesh has set ambitious revenue collection targets for the fiscal years 2024-25 and 2025-26, aiming to gather Tk 5872 billion and Tk 7097 billion, respectively. The strategy hinges on enhancing digitalization and simplifying tax procedures for both businesses and individuals. The focus will be on direct taxes and VAT to raise more revenue. In addition to expanding the tax net and increasing the capacity of tax officials, exercises will be carried out to rationalise the current culture of widespread tax exemptions and to bring in heightened transparency in the budgetary discourse. As per the Medium Term Macroeconomic Policy Statement (2023-24 to 2025-26) of the Finance Division of Finance Ministry, some Tk 5343 billion will come from the tax revenue sector in 2024-25 fiscal and Tk 6463 billion in 2025-26. In the next two fiscal years, the National Board of Revenue (NBR) will provide Tk 5095 billion and Tk 6171 billion. From the Income Tax wing, the projected collection will be Tk 1753 billion for the next fiscal, and Tk 2123 billion for 2025-26 fiscal. Collection from the import duties will be Tk 1511 billion and Tk 1830 billion respectively. Tk 16.8cr in 4 days: AL revenues from nomination forms outpace toll collection from megaprojects From VAT and Supplementary Duties, the revenue collection will be Tk 1831 billion and Tk 2218 billion respectively. The non-NBR tax for 2024-25 and 2025-26 will be Tk 248 billion and Tk 292 billion respectively. Non-tax revenue collection will be Tk 529 billion and Tk 634 billion respectively. The target for the running 2023-24 fiscal is Tk 5000 billion with Tk 4500 billion from tax revenue. Of the total amount, Tk 4300 billion will come from NBR through Tk 1480 billion from income tax, Tk 1275 billion from import duties, Tk 1545 billion from VAT and Supplementary duties. Some Tk 200 billion will be collected from the non-NBR sector while Tk 500 billion from non-tax revenue sector. According to the Medium Term Macroeconomic Policy Statement, revenue outturns estimated for 2023-24 and projection for the next two years show high elasticity and buoyancy, implying robustness in revenue mobilisation in the medium term. It mentions that among the tax and non-tax parts of the revenue, the tax revenue is forecasted to be more buoyant and elastic than the non-tax part. Read more: Tax automation would generate more revenue collection: DCCI President The elasticity data shows that the overall revenue is projected to grow 1.65 times higher than the nominal GDP in FY 2025-26. As per the statement, the revenue elasticity of GDP for the 2023-24 fiscal is 1.28 times higher than the last fiscal while it is projected to be 1.40 times higher in the next 2024-25 fiscal year. The tax revenue elasticity of GDP will be 1.33 times higher in the current fiscal while it will be 1.50 times higher in the next fiscal and 1.66 times higher in 2025-26 fiscal year. The non-tax revenue elasticity of GDP for the running fiscal will be 0.92 times higher in the current fiscal, 0.47 times higher in the next fiscal year, and 1.57 times higher in 2025-26 fiscal year. On the other hand, the buoyancy indicates that, in FY 2025-26 the tax revenue in real terms may grow 98 percent higher than the growth of real GDP. The Policy Statement mentions that the revenue mobilisation acts as a catalyst to achieve the development outcomes of a country. Bangladesh has envisioned its long-term development trajectory to be a higher middle-income country in 2031 and to be a developed country in 2041. Read more: Increase revenue, quality of services at airports: Faruk Khan tells CAAB In addition to these aspirations, the ‘Perspective Plan of Bangladesh 2021-2041’ has targeted to raise the revenue- GDP ratio to 19.55 percent by 2031 and to reach 24 percent by 2041. The statement says that the spectacular growth Bangladesh registered in the last decades, however, has not been underpinned by concomitant revenue growth. A large share of the revenue comes from the direct (income tax) and indirect taxes (VAT and customs) collected by the National Board of Revenue (NBR). Non-NBR taxes and Non-Tax Revenue (NTR) consists of smaller parts. It said that there is a need to identify the reasons for low revenue collection to move onto the essential next step to correct the course. It is important to understand various issues such as the economic structure (large informality and exemptions), structural weaknesses (complicated processes and information asymmetry), and cultural factors (apathy towards paying taxes) that contribute to significant underperformance in revenue collection. The government, the policy statement said, with the support of private sector operators, is keen to make paying taxes easy, tax rules easy to understand and rationalise tax exemptions. Success in revenue collection will be strengthened by making the tax administration easy to approach, increasing digitalization to bring in transparency and predictability and bringing in progressivity in taxation where rich people pay a higher part of the taxes, it added. Revenue collection up by 14.36 percent in July-October, but behind target: NBR

The import of stone through the land ports in Sylhet divisions which remained suspended since January 7 protesting hike in customs duty resumed on Wednesday. Md Atik Hossain, president of Sylhet District Stone Importer Group, said the importers halted import of stone from India on January 7 protesting the hike in duty on import of limestone and stone. GP unveils state-of-the-art data center in Sylhet A meeting was held with the leaders of the importers’ association led by Enamul Haque, commissioner of Customs Excise and VAT Sylhet Commissionerate, on Tuesday where the importers decided to resume import of stone from Wednesday after a fruitful discussion to reduce duty, he said. BPL 2024: Mahmudullah and Imran inspire Barishal’s big win over Sylhet However, the import of stone through Sutarkandi land port in Beanibazar upazila will resume from Thursday. The Sylhet Customs, Excise and VAT Commissionerate, following directives from the NBR, issued a letter on January 4, confirming the hike in customs duty on import of boulders, stone chips, and limestone from India. The new tariffs have been in effect since January 8 affecting all land ports and customs stations in the Sylhet region, including Tamabil. Youth dead, two wounded in Sylhet road crash

Leaders of Civil Society Organisations (CSOs) on Wednesday demanded the necessity to abolish the regressive tax system to eliminate the severe income inequality that has been created among the people in different countries of the world, including Bangladesh. The demand was from a rally organised by twelve civil society organisations led by Equity and Justice Working Group (EquityBD)  in front of the National Press Club in the capital in solidarity with the global civil society network Fight Inequality Alliance on the eve of the 54th Conference of the World Economic Forum with the slogan "Tax the rich, not the poor". Bangladesh Krishok Federation, Bangladesh Climate Journalists sorum, CPRD, Sundarbans and Coast Protection Movement, Online Knowledge Society, ASOD, Water Keeper Bangladesh, Trinamool Development Organization, CSRL, JSKS and Coast Foundation participated in the rally. E-commerce business must be sustained to build Smart Bangladesh: DNCRP DG Mostafa Kamal Akand, Director of Coast Foundation, moderated the programme, while ASM Badrul Alam of Bangladesh Farmers Federation presided over the meeting. Several  recommendations were placed in the rally, including a balanced and fair tax system should be established through legislation and enforcement to prevent tax evasion.  Other recommendations included that research,investigation and other effective measures should be taken to prevent capital flight and profit repatriation. Besides, the tax burden on the poor and underprivileged should be eased by gradually reducing all types of indirect taxes, including VAT. Motahar Hossain, on behalf of the Bangladesh Climate Journalist Forum, said that through indirect tax, basically, one person is forced to pay the tax of the other. Common consumers typically pay taxes levied on a company. This increases the cost of living for poor people. On the other hand, the company that is making income is exempted from tax. This system needs to be changed, he added. Shoeb Chy made Chairman of FBCCI standing committee on press, media Syed Aminul Hoque, Secretary of EquityBD, said that the ongoing conference of the World Economic Forum (WEF), in fact, works for the multinational profiteering companies engaged in tax dodging and money laundering from poor countries. "In this context, we need a global tax network under the UN framework where poor countries can protect themselves against tax dodging, and thus, money laundering will also be stopped. We expect our Prime Minister to convey this message while participating in the 54th Annual Conference of WEF," he said. Imran Hossain of the CPRD said that tax evasion has become a normal practice in Bangladesh. "We have laws and penalties for this, but they are not enforced. Emphasis should be placed on income tax and wealth tax collection to reduce indirect taxes," he said.   Nikhil Chandra Bhadra of the Sundarbans and Coast Protection Movement said that the people of Bangladesh fought the liberation war to abolish a discriminatory social system. But now, the disparity between the rich and the poor is the highest ever in the country’s history. This disparity can be reduced through an accountable and well-governed tax system. Pradip Kumar Roy of Online Knowledge Society said that Bangladesh has often been praised for standing up for poor people and less developed countries at international conferences. Cautionary monetary policy likely to stabilise forex reserve, contain Inflation: DCCI President "We want Bangladesh to become the voice against discrimination and poverty alleviation in the upcoming conference of the World Economic Forum," he said.  In the closing speech, ASM Badrul Alam of the Bangladesh Krishok Federation said that all indirect taxes, including VAT, should be gradually reduced to ease the tax burden on the poor, and emphasis should be placed on bringing all industrialists and corporations under direct tax to increase the government's revenue.

Finance Bill 2023 was passed on Sunday (June 25, 2023), dropping the much-debated proposed provision for Tk 2,000 for every TIN holder during submission of their income tax return. Finance Minister AHM Mustafa Kamal moved the bill and it was passed by voice vote. The finance minister accepted some other minor proposals on the finance bill in section 2 and 2-Ka. The other amendment proposals were rejected by a voice vote. Read more: Several reform initiatives on the cards as govt moves to shore up economy The finance minister accepted an amendment scrapping specific duty on import of fuel oil by reinstating the previous tax on value as concerns grow over a significant hike in prices of petroleum products under the new tax measures. The specific duty on oil imports came into effect on June 1, 2023, under the ‘Provisional Collection of Taxes Act 1931 (Act No. XVI of 1931) in the Finance Bill placed before parliament on that day. Customs Duty, VAT and Advance Tax on the import of fuels have been reinstated in the Finance Act 2023, as those were scrapped in the bill. The proposed value-added tax (VAT) on the manufacturing of ballpoint pens has been cut to 5 percent from 15 percent. Read more: e-TIN: Online registration process in Bangladesh In the Finance Bill on June 1, the finance minister proposed Tk 2,000 as minimum tax on those who have no taxable income but need to submit tax returns for availing government services.