VAT on five food items waived
Wednesday, 20 October 2010
Nazmul Ahsan
The government has fully waived the value added tax (VAT) on five essential food items to be procured by the state trading entity- the Trading Corporation of Bangladesh (TCB), to help rein in their soaring prices in the local market.
The rate of VAT on these items now stands at 6.0 per cent
The National Board of Revenue (NBR) last week, at the request of Ministry of Commerce (MoC), waived the tax against some specific quantities of food items for a specific period, a high official in the ministry said.
The items are edible oils, pulse, onion, sugar, and lentil. The MoC appreciated the government decision, saying the measure was timely.
"It's a time befitting decision, which would go in favour of consumers," Md Ghulam Hossain, Secretary, MoC told the FE on Monday.
"The TCB will undertake efforts soon to procure food items from local markets so that essential items can be sold at cheaper rates following the VAT waiver as a special case," he added.
According to the office order of NBR, VAT exemption will be applicable to procurement of 38,000 tonnes of soybean and palm oil, an equivalent quantity of sugar, 10,000 tonnes of lentil, 750 metric tonnes each of pulse and onion.
The VAT-waiver facility will remain valid for the next one year, the NBR order said.
TCB officials said the suppliers of essential items to TCB will not be required to pay 4.0 per cent and TCB dealers 2.0 per cent VAT.
"The decision would certainly help lower the market prices of food items to be sold by TCB," a top TCB official said.
'We will further strengthen the Corporation so that market intervention by TCB becomes more meaningful", he said.
The government has fully waived the value added tax (VAT) on five essential food items to be procured by the state trading entity- the Trading Corporation of Bangladesh (TCB), to help rein in their soaring prices in the local market.
The rate of VAT on these items now stands at 6.0 per cent
The National Board of Revenue (NBR) last week, at the request of Ministry of Commerce (MoC), waived the tax against some specific quantities of food items for a specific period, a high official in the ministry said.
The items are edible oils, pulse, onion, sugar, and lentil. The MoC appreciated the government decision, saying the measure was timely.
"It's a time befitting decision, which would go in favour of consumers," Md Ghulam Hossain, Secretary, MoC told the FE on Monday.
"The TCB will undertake efforts soon to procure food items from local markets so that essential items can be sold at cheaper rates following the VAT waiver as a special case," he added.
According to the office order of NBR, VAT exemption will be applicable to procurement of 38,000 tonnes of soybean and palm oil, an equivalent quantity of sugar, 10,000 tonnes of lentil, 750 metric tonnes each of pulse and onion.
The VAT-waiver facility will remain valid for the next one year, the NBR order said.
TCB officials said the suppliers of essential items to TCB will not be required to pay 4.0 per cent and TCB dealers 2.0 per cent VAT.
"The decision would certainly help lower the market prices of food items to be sold by TCB," a top TCB official said.
'We will further strengthen the Corporation so that market intervention by TCB becomes more meaningful", he said.