Staff Reporter :
Bangladesh Restaurant Owners Association has threatened to go on strike unless the government reconsiders its plan to increase Value Added Tax (VAT) on hotels and restaurants.
The restaurant owners issued the warning at a press conference held at a city hotel in Dhaka yesterday.
Imran Hasan, secretary general of the Restaurant Owners Association, criticized the plan to hike VAT rate amid the current high inflation rate.
The plan of increased VAT would directly impact the general people, he added.
He suggested that the government could reduce administrative costs and cut unnecessary projects to address budget deficits instead of imposing such a heavy tax burden on businesses.
The National Board of Revenue (NBR) has proposed raising VAT on food at hotels and restaurants.
Currently, patrons at regular and air-conditioned (AC) restaurants pay a 5 percent VAT, which could rise to 7.5 percent. The VAT for non-AC hotels is proposed to be doubled from 7.5 percent to 15 percent.
Hasan criticized the government for relying on VAT as a primary revenue source instead of expanding direct taxes.
“Only about 525,000 businesses are VAT-registered, with roughly 350,000 paying VAT regularly. The NBR has not taken effective steps to bring the millions of unregistered businesses under the VAT net,” he said.
