Muhammad Ayub Ali :
If the annual turnover exceeds Tk 30 lakh, businesses must now register for VAT (turnover tax registration), a reduction from the previous threshold of Tk 50 lakh, as per an ordinance issued by the National Board of Revenue (NBR) last Thursday.
Additionally, the VAT registration limit has been lowered from Tk 3 crore to Tk 50 lakh. The NBR has also imposed VAT on life-saving drugs to increase revenue collection.
The ordinance, issued under pressure from the International Monetary Fund (IMF), raised VAT and supplementary duty on 67 goods and services, including internet services.
It also reduced the thresholds for turnover and VAT registration, bringing small and medium enterprises (SMEs) under VAT regulations, which could raise their cost of doing business.
Mirza Nurul Goni Shovan, President of the National Small and Cottage Industries Association Bangladesh (NASIB), told The New Nation that small and medium businesses are already struggling with challenges such as high raw material costs and competition from large corporations.
“The increase in VAT and supplementary duty on over 90 products and services has further crippled small and medium businesses,” he said.
VAT on medicines has risen from 2.4 percent to 3 percent at the supply stage, potentially driving up the cost of medicines. Other items affected include LP gas, sweets, biscuits, pickles, tomato sauce, fruit juice, cigarettes, soaps, detergents, mobile services, and broadband internet.
Supplementary duty has also been imposed on electrolyte drinks popular among young people. As in previous years, supplementary duty on cigarettes has increased, leading to higher cigarette prices in the market.
The VAT on broadband internet services has doubled from 5 percent to 10 percent, while supplementary duty on mobile phone calls and internet services has also been raised.
Mustofa Kamal, an SME entrepreneur, shared his frustration with The New Nation, saying, “We are being pressured from all sides. How can we continue our business under these circumstances? We cannot give up our businesses, yet it is becoming increasingly difficult to sustain them.”
