The government is finally moving away from implementing the new VAT law as it triggered huge dissent in the parliament and outside since the state’s decision to activate it.

Prime Minister Sheikh Hasina is expected to announce the cancellation of the new VAT law at the parliament session on June 28, responding proposals from National Board of Revenue (NBR) and the finance department of the government, sources said.

Earlier it was decided in the newly proposed law to fix the single VAT rate at 15 percent. Later, it drew huge criticism among different quarters including the government officials.   

However, NBR now is trying to decide as how they can increase tax income keeping the existing VAT law of 1991 into effect with some possible amendment. 

Sources said that Finance minister Abul Maal Abdul Muhith, NBR Chairman Nojibur Rahman and Prime minister Sheikh Hasina sat in a special meeting with some higher VAT officials on Thursday (June 22). 

In the meeting, a draft was presented outlaying the less tax earning sectors if the reduced VAT rate is come into effect instead of the earlier fixed 15 percent rate. Besides, the meeting also discussed about the necessary changes in the old VAT law to earn the increased VAT amount, in case of not implementing the new law.  

NBR officials are assuming that if the new VAT law isn’t effective, it will be tougher to acquire the targeted amount which is Tk23 thousand crores more than the revised target of the current fiscal year.

Earlier, on June 1, Finance minister announced the new VAT law to be implemented from 2017-18 FY.

However, NBR is working for repealing the new VAT law besides the increased excise duty.

BDST: 1551 HRS, JUN 23, 2017
SI