Dhaka: The National Board of Revenue (NBR) has announced a reduction in Value Added Tax (VAT) on a range of goods and services, including crucial sectors like medicine, mobile talk-time, internet, and restaurant services, aiming to ease costs for the public.
According to Bangladesh Sangbad Sangstha, the NBR issued a press release today highlighting that VAT on non-branded clothing has also been withdrawn. This decision follows the issuance of the “Value Added Tax and Supplementary Duty (Amendment) Ordinance 2025” and “The Excises and Salt Act (Amendment) Ordinance, 2025” by the government on January 9, 2025, to strengthen Bangladesh’s financial base. Notifications were also issued for re-fixing VAT, Supplementary Duty, and Excise Duty rates on certain goods and services, considering feedback from professional organizations, civil society, and stakeholders.
In a move to make medical services more accessible, the increased VAT rate on the pharmaceutical industry at the business level has been completely withdrawn, maintaining the previous rate of 2.4 percent. This initiative is expected to support growth in the pharmaceutical sector and stabilize consumer prices.
The NBR has also eliminated the increased supplementary duty on mobile phone services and internet service providers (ISP), thus preventing a rise in consumer expenses in these sectors. This aligns with efforts to promote digital activities and foster a modern IT-based young generation.
To provide affordable dining options, additional VAT on all restaurants, except those in three-star and above hotels, has been completely withdrawn. Similarly, VAT has been removed from motor vehicle garages and workshops to prevent price hikes in related services.
Moreover, the VAT rate for non-AC hotels, sweet shops, and proprietary brand apparel sales has been reduced from 15 percent to 10 percent. Additionally, extensive tax exemptions have been applied to essential imports and services, including edible oil, sugar, and public transportation like the metro rail service, to further ease financial burdens on consumers and improve the quality of life.
Lastly, the excise duty on Hajj tickets has been fully withdrawn, reducing travel costs for pilgrims. These measures reflect a comprehensive approach by the NBR to address economic challenges and support various sectors of the economy.