The National Board of Revenue (NBR) has reduced Value Added Tax (VAT) on several goods and services, including medicine, mobile talk time, internet, and restaurants, considering the public interest.
Today’s NBR press release said that the VAT on non-branded clothing has also been withdrawn in addition to these four sectors.
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 notifications to re-fix 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, VAT deduction rate at source, and supplementary duty rate on certain goods and services.
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of the population, the increased VAT rate at the business level on the pharmaceutical industry has been completely withdrawn, and the previous rate of 2.4 percent has been maintained.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.
To continue the country’s ongoing digitization activities, 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the use of mobile phone SIM or RIM cards and the newly imposed supplementary duty on ISP services have been completely withdrawn.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 withdrawal of the increased or newly imposed supplementary duty on mobile phones and ISP services will ensure that consumer expenses in these sectors do not rise.
To facilitate the large population’s consumption of 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the additional VAT imposed on all restaurants except three-star, four-star, and five-star hotels has been completely withdrawn.
The complete withdrawal of the additional VAT will allow common people to consume food in these restaurants at the previous price.
The increased VAT has also been completely withdrawn from motor vehicle garages and workshops.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.
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 to ensure the easy availability of books for students at all levels of Bangladesh, build a modern, information technology-based education system, and improve the quality of the education system.
VAT exemption has also been provided on the fast, safe, and environmentally friendly metro rail service, which plays an essential role in reducing traffic congestion.
In addition, the NBR has completely withdrawn the excise duty on Hajj tickets to reduce the costs for Hajj passengers.
Cox’s Bazar Life Desk/BSS
