Hotel-restaurant traders urged the government to reduce the Value Added Tax (VAT) for moderate, lower category and fine-dining restaurants in the proposed national budget of 2021-22.
Bangladesh Restaurant Owners Association (BROA) asked for cancelling the 10 per cent supplementary tax at a press conference on Saturday, that was organized to express their opinion on the proposed budget.
"The proposed budget for 2021-22 FY mentioned 15 per cent VAT for air-conditioned (AC) and 3-5 per cent for non-air-conditioned restaurants. However, we want it to be reduced to 3-5 per cent for lower and moderate categories, and a 7.5 per cent VAT for fine-dining restaurants," Imran Hasan, secretary-general of BROA, said at the event.
"Earlier, the non-AC restaurants had to pay 7.5 per cent VAT. Since AC is a general necessity nowadays, these categories for VAT payment should be abolished," he added.
BROA proposed a 15 per cent VAT for five-star and four-star category hotels and restaurants. Besides, the association proposed a 2 per cent VAT for the canteen or cafeteria of educational institutions, hostels and industrial factories.
The country has nearly 60,000 restaurants and around 30 lakh people are involved in the sector, according to BROA.
The association leaders further mentioned that around 30 of the restaurant owners have permanently shut down their businesses and many have shifted ownership amid the coronavirus pandemic.
Besides, to keep the hotel-restaurant sector afloat, loans up to Tk 10 lakh to Tk 1 crore without collateral from the SME sector at a maximum rate of 4 per cent interest, as well as approval of loans in the hotel-restaurant sector of Bangladesh Bank were demanded to be amended.
EFD machines should be installed in all types of hotels and restaurants to ensure 100 per cent collection of VAT from this sector. However, EFD machines have not yet been installed in many hotels and restaurants. But many cases are being filed against the hotels and restaurants where EFD machines have been installed.
At the same time harassment in the name of collecting VAT through third parties should be stopped. The association demanded cancellation of all types of fines and other charges for the collection of VAT.
Among others, BROA President Osman Gani, Organising Secretary Syed Mohammad Andalib, and Publicity Secretary Ashfaq Rahman Asif were present at the event.
