Muhith: IMF has urged caution with VAT

The International Monetary Fund (IMF) has warned Bangladesh to be careful with how they handle the enactment of new VAT laws, Finance Minister AMA Muhith told reporters on Monday. The minister said: "The IMF urged the government to be cautious with the implementation of the new VAT law that is supposed to be effective from July 1.”

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After meeting with the high profile IMF delegation, the finance minister told reporters that they had urged caution with the VAT Dhaka TribuneThe finance minister made the comment after a meeting with four visiting members of IMF at the finance ministry secretariat office. The high profile IMF delegation included Deputy Managing Director Mitsuhiro Furusawa and Executive Director Subir V Gokarn. Muhith added that a committee of the National Board of Revenue was currently working with businessmen regarding execution of the new VAT. “We will make a decision on the execution of the VAT after the committee submits its report,” said the finance minister. He also pointed out that the government already provided different facilities to businessmen which should ease the burden of the VAT. The new law, under the controversial Value Added Tax and Supplementary Duty Act 2012, has drawn widespread criticism as it will impose a flat 15% VAT for all sectors and emphasise proper account keeping of transactions at every stage of supply of goods and services by both manufacturers and service providers.