Uniform 15% VAT rate planned for all sectors: NBR chief

The government plans to implement a uniform 15% value-added tax (VAT) rate across all sectors, National Board of Revenue (NBR) Chairman Abdur Rahman Khan said today (21 April).

“Standard VAT rate will be applied equally for all. Those eligible will receive rebates. However difficult it may be, we will move in this direction,” he said during a pre-budget discussion with business leaders at the NBR headquarters in Dhaka’s Agargaon.

The NBR chief also stressed that there will be “no compromise” on advance income tax (AIT), which is collected at the import stage.

Currently, although the standard VAT rate is set at 15%, the NBR applies reduced or truncated rates across various sectors in response to business demands. Development partners have long argued that such variations distort the tax system.

The push for a uniform VAT structure also aligns with recommendations from the International Monetary Fund (IMF), which has been urging Bangladesh to fully implement the standard rate.

Abdur noted that compliance remains a major challenge. “A section of businesses consistently pays VAT, while another group does not. This increases the burden on compliant taxpayers,” he said.

Bangladesh passed a new VAT law in 2012 with provisions for a single uniform rate, but later deviated from it by introducing multiple rates for different sectors following pressure from businesses.