Tour operators call for withdrawal of VAT hike

The finance minister proposed to double the VAT in the sector from the existing 7.5 percent to 15 percent

The Tour Operators Association of Bangladesh, or TOAB, has called on the government to withdraw the increase in value added tax (VAT) on tour operators to 15 percent in the budget for the fiscal year 2024-25.

Finance Minister Abul Hassan Mahmood Ali tabled the proposed Tk 7.97 trillion budget in the parliament on Thursday.

In the budget, the minister proposed to increase the VAT on the service of ‘Amusement Park and Theme Park’ to 15 percent from the existing rate of 7.5 percent.

He also withdrew the VAT exemption on the service of tour operators.

Given the changes, TOAB President Mohammed Rafiuzzaman made the call to withdraw the VAT hikes during a meeting with Mahbubul Alam, president of the Federation of Bangladesh Chambers of Commerce and Industry, or FBCCI on Friday.

TOAB also outlined several other protest plans to press ahead with its demand for the withdrawal of VAT, the top agency in the tourism sector said in a statement on Saturday.

The TOAB chief said, “We cannot ask the tourists to pay VAT on the tours we operate because the hotels pay the government VAT on the food and accommodation we provide to customers.”

“The tourism sector and tour operators will suffer badly if the VAT is imposed separately on us. That’s why we are calling on the government to withdraw VAT in the sector.”