An adviser of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) yesterday urged the National Board of Revenue (NBR) to take necessary steps to arrange a meeting between the business community and the International Monetary Fund (IMF) to exchange views on implementation of the new VAT law.
He questioned the role of IMF in implementing the new law on Value-Added Tax and Supplementary Duty Act - 2012, which is set to come into effect from July 2016.
“The executive body of IMF is working to reform the existing VAT system in Bangladesh and we are not against it if it is made to make the system transparent, automated and business friendly,” said FBCCI Adviser Manzur Ahmed. “Though they are not officially pressurising us, they are actually doing it for implementation of single digit VAT rate.”
He said that there is multiple VAT rate in 27 countries in European region, but IMF is not working there for single digit.
“IMF recently made a reform in Vietnam’s VAT system, but the country also has a four stage VAT collection system. Why they (IMF) is not going to these countries. What their problem with Bangladesh,” questioned the adviser.
The new Value-Added Tax and Supplementary Duty Act-2012 will have no provisions for package VAT or truncated value-based VAT system. With the introduction of the law, all level of business has to pay a unique and a single VAT rate at 15%.
“VAT system exists in 95% of the countries. But you will not find any of the countries where the VAT rate is collected in single digit. What is the problem in introducing multiple VAT rate in Bangladesh,” he said.
The adviser requested the NBR to take necessary steps to arrange meeting between IMF and the businesses in regards to the implementation of the new VAT law.
“We will sit with IMF with documents and talk directly with them regarding VAT,” he added.
The FBCCI adviser came up with the observation during a pre-budget meeting of NBR at its headquarters in Dhaka. NBR Chairman Md. Nojibur Rahman chaired the meeting.
Manzur Ahmed said: “Substantial input in the content of our vat law is beyond their jurisdiction. For the interest of Bangladeshi citizens and the businesses, we will talk this to IMF. Please ask them (IMF) not to talk rubbish and ask them to stay in their limit,” Manzur observed.
The business leaders have been opposing the move made by NBR to implement single digit VAT rate in the country.