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VAT exemption provision simplified to boost export

Published : 15 Nov 2021 11:05 PM | Updated : 16 Nov 2021 03:56 PM

Export-oriented sectors will now be able to ship their products more easily and quickly as the mandatory provision of obtaining VAT-exemption certificate has been simplified to boost exports.

The National Board of Revenue (NBR) issued a notification on Thursday to expedite the overall exports of the country.

After the removal of the mandatory provision of obtaining VAT-exemption certificate, exporters will no more require to submit it to get services from the ports, freight-forwarders, clearing and forwarding agents, inland container depots, and shipping lines, said NBR sources.

Earlier, exporters had to obtain the certificate from customs, excise and VAT commissionerate (VAT zone) and produce to the port customs or private ICD to avail the VAT exemption 

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But now on, as per the decision of the value-added tax (VAT) wing of NBR, the export-oriented industries can enjoy speedy cargo delivery from the customs ports as the time-consuming process to avail VAT-exemption certificate is no more effective, said a businessman.

The policy wing on VAT issued an order on November 11, 2021 relaxing the provision following proposal of the exporters and operators of the private inland container depots or ICDs. 

According to NBR officials, the NBR has taken the step after a meeting with all stakeholders, presided over by VAT policy member Masud Sadiq, held at its headquarters on October 17.

The order, signed by First Secretary (VAT policy) Kazi Farid Uddin, has been given retrospective effect since September 26, 2019. 

Sources said after the NBR's recent decision, the exporters will get VAT exemption on those services against their association membership certificate, and VAT and Bangladesh Investment Development Authority (BIDA) registrations only. 

Exporters have welcomed the move, saying it will make it easier for the export-oriented industries to get export-import products released from ports. 

Exporters also want withdrawal of the requirement for the certificate in paying gas and electricity bills. 

Highly appreciating the NBR's steps Mohammad Hatem, vice president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said the decision would certainly help ease the doing-business in the country. 

"It is a very positive step. Collection of VAT-exemption certificate was a difficult process that slowed down overall export activities delaying release of goods," he added. 

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