Passengers of the country’s first ever metro-rail in capital Dhaka are going to enjoy the advantage of a 15 percent Value Added Tax (VAT) exemption on ticket prices.
The VAT waiver for metro rail tickets has been implemented since December 28 and will continue to be in effect until June 2024.
The National Board of Revenue (NBR) released a notification in this regard on Sunday.
According to the notification signed by Mohammad Hasmat Ali, the first secretary of NBR, the metro rail has a significant role in alleviating traffic congestion in Dhaka city.
Furthermore, in order to promote this mode of public transport, it is essential to reduce the financial burden on passengers, it said.
“As per the current VAT Act, any air-conditioned railway ticket is subject to 15% VAT. Metro rail is fully air-conditioned and public transport,” it reads.
The notification further mentioned that a few months ago, the Dhaka South VAT Commissionerate had sent a letter to the Dhaka Mass Transit Company Limited (DMTCL) regarding the imposition of VAT on metro rail tickets.
However, the DMTCL did not agree with this proposal.
Their argument was that metro rail services cater to people from all walks of life, rather than just elites.
Upon receiving the response from the metro rail company, a letter was sent to the NBR asking for instructions in this regard from the Dhaka South VAT Commissionerate.
Hence, NBR has issued new instructions that VAT will not be levied on metro rail tickets till June 2024.
