Restaurant owners seek lower taxes, gas connections and end to bureaucratic harassment
While the VAT on the sector was previously reduced from 15% to 5% after discussions with the NBR, restaurant owners claimed they are still struggling under a 10% supplementary duty, source tax, and other levies
Restaurant owners have urged the government to reduce value-added tax (VAT), resume new gas connections, and end what they termed "harassment" by multiple regulatory agencies to help the sector survive mounting economic pressure.
The Bangladesh Restaurant Owners Association placed an 11-point charter of demands at a press conference held at the Dhaka Reporters Unity today (10 May), ahead of the upcoming national budget.
Their demands include keeping VAT and tax rates at a "tolerable level," resolving the ongoing LPG crisis, and introducing a one-stop service for licences and permits.
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They also called for restarting pipeline gas connections and stopping extortion and intimidation in the name of trade unions.
The uncontrolled rise in commodity prices has pushed essential goods beyond consumers' purchasing power. Its direct and severe impact is now being felt across the restaurant sector
Speaking at the event, association Secretary General Imran Hasan said the industry has yet to fully recover from the Covid-19 shock, while global instability and rising fuel costs have further increased operational expenses.
"The uncontrolled rise in commodity prices has pushed essential goods beyond consumers' purchasing power. Its direct and severe impact is now being felt across the restaurant sector," he noted.
While the VAT on the sector was previously reduced from 15% to 5% after discussions with the National Board of Revenue, restaurant owners claimed they are still struggling under a 10% supplementary duty, source tax, and other levies.
The association called for the withdrawal of source tax and a flat 5% VAT rate for canteen and catering services in the upcoming budget.
Imran argued that high tax rates discourage compliance and lead to tax evasion, suggesting that reducing rates while expanding the tax net would ultimately increase government revenue.
The association also highlighted that around 80% of restaurants in the country remain unregistered, often operating without maintaining hygiene standards or paying taxes.
Regarding energy challenges, the association said the ongoing LPG shortage has disrupted operations and increased food prices.
It urged the government to increase LPG imports, improve supply management, and restart new pipeline gas connections.
Restaurant owners further accused several government agencies, including Rajuk, the fire service, and the Department of Environment, of creating bureaucratic complications and unnecessary pressure.
Currently, opening a restaurant requires 10 to 12 different approvals, a process that can take up to six months, according to the association.
Other demands placed by the association include reopening trade licence services by the two Dhaka city corporations, preventing "corporate aggression" in the sector, allowing beef imports, and introducing government-supported training programmes for unskilled workers.
