Bangladesh 15% VAT implementation Jul 2019

The Bangladesh 2019/20 budget now includes details of the proposed implementation of a 15% VAT regime from the 1^stJuly 2019.

Key features of the regime will include:

• Standard rate of 15%, plus three reduced rates of 10%, 7.5% and 5% (the original plan had been for a single 15% rate)
• Only input VAT charged at 15% would be deductible against output VAT, raising the prospect of cumulative taxes
• Exemptions are granted for agricultural supplies and financial services
• The VAT registration threshold will be BDT30m
• Traders up to BDT5m will be exempted
• Traders between BDT5m and BDT30m will be subject to a 4% Turnover Tax
• Online e-services provided from abroad will be included within the tax net