NBR waives VAT at trading stage for biscuits, flour, salt, lentils

The Internal Resources Division (IRD) under the Ministry of Finance has exempted VAT at the trading stage for certain essential commodities, aiming to stabilise the consumer goods market.

The list includes domestically produced flour and biscuits, refined flour, salt, lentils and leguminous grains, mustard oil, rice bran oil, ground chilli, coriander, ginger, rapeseed oil, colza seed oil, canola oil, turmeric or similar spice blends and semolina and sunflower seed oil.

Additionally, certain insecticides used in agriculture have been added to this list.

Previously, these products were subject to VAT at the trading stage, ranging from 5% to 7.5%.

The IRD issued a statutory regulatory order to this effect on Sunday, which was published today.

A senior official from the National Board of Revenue (NBR), involved in the process, spoke to The Business Standard on condition of anonymity, stating, "The products in question have VAT exemptions at the production stage. However, some have VAT at the trading stage. Some individuals are attempting to destabilise the market using this as a pretext."

He said VAT has been removed from these products at that stage to prevent anyone from destabilising the market under the pretext of VAT at the trading stage.

The official further said, "Currently, most super shops charge VAT at the standard rate (15%), so it is reasonable not to have separate VAT at the trading stage for these products. 

"Moreover, there are allegations that traders in Old Dhaka are increasing prices using this as an excuse. Therefore, the government has taken this measure."