The new VAT law will push up living cost – Study Book BD staff Reporter: New VAT law can increase many products and services costs and harm consumers, analysts said yesterday.
The role of such a rate goes against the basic principles of law. There is no discount for VAT and services of less than 15 percent VAT, so costs for some products can increase by 38 percent.
After the inauguration of the fiscal year 2011-12, the government has been inaugurating the budget as soon as it talks about VAT and Supplementary Duty Act 2012. It plans to launch four key rates to move away from the original main uniform. Percentage rate
The Daily Star and the Institute of Chartered Accountants of Bangladesh (ICAB) jointly participated in a discussion organized by the Daily Star Center in a discussion to analyze the proposals in the budget.
Planning Minister MA Mannan was the chief guest at the ceremony, where businessmen, economists and professionals spoke.
VAT will be 5 percent, 7.5 percent, 10 percent, and 15 percent in new system. However, if the traders enjoy VAT rebate, then only 15 percent VAT will be paid.
According to the Bill 2019 released on Thursday, the government has also announced four special VAT rates for goods and services, including medical, petroleum products and flat registration, and tax deducted in certain products including iron rods and bricks.
“This is a complete disaster,” said Executive Director of Bangladesh Policy Research Institute (PRI) Ahsan H Mansur on New VAT Act.
He said, “It should be labeled as [new VAT law] VAT and Excise Duty Act 2019 because it is a combination of VAT and excise duty.”
Mansur said, no business is eligible for paying 15 percent VAT, but tax will be tolerated.
“We have been really abused by the introduction of the new VAT law. We were good as per the 1991 law,” he said.
“You have VAT-free trade for excise. There is no VAT left. Only pure and easy cascading acquisition system,” Mansur said adding the role of the system would harm the development of small and medium enterprises.
Senior lawyer of Bangladesh Institute of Development Studies Nazneen Ahmed Mansur agreed with VAT law. He said it would distort the whole system and damage the business community.
ICAB President AF Nesuruddin said that multi-level VAT rates were actually the continuation of the existing system.
“It should be taken immediately to implement the smooth implementation of this VAT law, its smooth implementation,” he advised not to allow VAT taxation of 15 percent VAT products and services.
Snajash Barua, who presented a paper on financial measures in the budget, offered a proportionate discount for at least 15 percent VAT.
“VAT has been penalized for compliance with the rules, it should be reduced,” he said.
Planning Minister MA Mannan said, he was always in favor of single VAT. He said that there was a need for huge reforms on the Revenue Board, but it was not easy to think the job was right.
He said, “Fair interest groups who always oppose NBR reform,” he said.
Analysts warned that without the power of the revenue collector the government’s ambition to achieve revenue target will not be achieved.
Dependence on bank loans for the government’s debt deficit will increase the burden on the sick banking sector, which will be affected by the liquidity crisis due to the recent increase in the default loan, deposit deposits and the recent increase in public debt.
As a result, investors may have difficulty in investing in private sector, analysts say.
Referring to the liquidity crisis of the bank, Syeda Mahbubur Rahman, president of the bank’s association, said the bank would put more pressure on the sector by increasing credit growth.
Abul Kashem Khan, former President of Dhaka Chamber of Commerce and Industry, has demanded a visible and exemplary punishment for deliberately defending the default.
Rakibur Rahman, former president of the Dhaka Stock Exchange, said the government’s proposed steps in the capital market would be beneficial for small investors.