BROA demands uniform VAT, pro business environment

The Bangladesh Restaurant Owners Association (BROA) has urged the government to introduce a uniform 5.0-per cent VAT and tax rate for both restaurant and catering services and withdraw the proposed source tax and supplementary duty on essential commodities in the national budget for fiscal year 2026-27.

The association also placed a seven-point set of proposals aimed at easing operational pressure on the industry, At a press conference on Friday at its central office in Bijoynagar, Dhaka, at a press conference on Friday morning at its central office in Bijoynagar, in the city.

Reading out a written statement, BROA Secretary General Imran Hassan welcomed the initiative of the BNP government and Finance Minister Amir Khosru Mahmud Chowdhury to formulate a business-friendly budget amidst prevailing macroeconomic challenges, high inflation, and banking sector volatility.

He, however, noted that soaring operational costs driven by spikes in electricity and LPG prices, coupled with high inflation, have pushed the restaurant industry into a deep crisis, which was not adequately addressed in the proposed budget.

Expressing severe frustration over regulatory bottlenecks, Imran Hassan said, “It feels as if we are living in the Dark Ages (Ayyam-i Jahiliyya). There are only black laws and harassment everywhere.”

He urged the newly formed government to ensure a harassment-free environment to keep businesses afloat.

Presenting the demands, BROA proposed a uniform 5 percent VAT for both restaurants and catering services to eliminate existing market discrimination.
Currently, restaurants pay 5 percent VAT while catering services are charged 15 percent.

The association also demanded bringing all food establishments, including street food vendors, under the VAT registration net to stop unfair competition and boost government revenue.

To alleviate the cost-of-living pressure on ordinary citizens, BROA urged the government to completely scrap the proposed 0.5 percent source tax and 10 percent supplementary duty on essential commodities.

While thanking the government for offering a 60 percent depreciation benefit in the first year and 40 percent in the second year for new restaurant machinery outside Dhaka, the association requested the Ministry of Finance and Bangladesh Bank to issue special directives to financial institutions for providing low-interest loans to the sector.

Refusing the Finance Minister’s proposal to extend the VAT payment period to three months, the association demanded maintaining the previous system of monthly VAT payments and return submissions to ensure a smooth business workflow.

Highlighting red-tape bureaucratic hurdles, Imran Hassan pointed out that a restaurant currently needs 10 to 12 separate approvals from various authorities to operate, which breeds harassment and escalates costs.

To resolve this, the association demanded the immediate implementation of a “One-Stop Service” under an integrated compliance framework, the formulation of a specific industry policy for the restaurant sector, and making BROA membership mandatory for launching any restaurant business in line with the Trade Organizations Act

Among others, BROA Vice President Shah Sultan Khokon, Joint Secretary General Firoz Alam Sumon, and Organizing Secretary Towfikur Islam were present at the press conference.