Bangladesh waives penalties on late VAT payment amid COVID-19 outbreak

The government has waived all fines or interests in case of failure to pay VAT returns on time during the coronavirus outbreak.

The final draft of ‘Value Added Tax and Supplementary Duty Act (Amendment) Ordinance, 2020’ was cleared by the Cabinet in a meeting at Ganabhaban on Thursday.

Chaired by Prime Minister Sheikh Hasina, it also decided to waive penalties if the deadline to pay income tax returns is missed amid the ongoing pandemic.

Cabinet Secretary Khandker Anwarul Islam announced the new rules in a briefing on Bangladesh Television and the Cabinet Division made the audio recording of the briefing public.

“The National Board of Revenue kept the VAT circle offices open all over the country from Apr 12-15 on a limited scale amid this disaster to collect monthly VAT return submissions,” he said.

“But most business organisations failed to submit their VAT returns due to the disastrous situation,” he said, pointing out that government heeded requests from FBCCI and several other organisations for an extension of time for filing VAT returns.

To add provisions of extending time, a “new sub-section (2) has been added to section 64 of Value Added Tax and Supplementary Duty Act, 2012, which had no scope of extension of time, with effect from April”.

It states “…during natural calamities, epidemics and state of emergencies, the NBR will be able to extend the deadline” for VAT return submissions without levying penalties.

The parliament sessions are suspended amid the shutdown, and so the law ministry will examine the new provision before passing an ordinance with the approval of the president. It will be presented to parliament when on the first day of its resumption.