Staff Reporter :The Finance Minister AMA Muhith has proposed to raise package VAT for wholesalers and retailers by 40 per cent to 100 per cent.At the same time, the existing uniform trade VAT at the rate of four percent will remain unchanged at the wholesale and retail levels.Wholesalers and shopkeepers now pay VAT (value added tax) for Tk 3,600, Tk 7,200, Tk10,000 and Tk14,000, respectively depending on their turnover and locations.The Finance Minister proposed to increase the tax to Tk 7,000, Tk 14,000, Tk 20,000 and Tk 28,000 respectively depending on turnover and locations.”Those of the traders who are willing to pay VAT on actual value addition, a standard VAT at the rate of 15 percent would be applicable,” according to the budgetary speech.For them, input tax credit and adjustment facility on easy terms would be available, according to the budget proposal.The businesses and market experts expressed their dissatisfaction at the hike in VAT saying that price of essentials and other commodities will further increase if such illogical increased rate is implemented.They said, limited income consumers will be the ultimate sufferers of such higher rate of VAT.President of Bangladesh Dokan Malik Samity, an association of 2.5 million shops in the country, Kader Kiron told that high-end shops could manage, but small shops across the country, where middle and low income people rush, will face a blow.Many of the shops will be closed, while prices of products will rise significantly.He demanded cancellation of the decision for small retailers and traders upon whom the limited income people depend a lot.Secretary of Moulovibazar Aratdar Babaoshayee Samity, an organisation of wholesalers in the city, Golam Mawla said prices of essentials will be increased significantly at retail level.He said such high-rated-hike in VAT is illogical as the marginal shop owners will not be able to pay such amount.He also said that the essential market might be volatile in the holy month of Ramzan if government tried to implement such higher VAT.
