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| wholesale and trade-based VAT rate |
What are retail or wholesale and trade-based supply VAT rate in Bangladesh?
While Bangladesh's standard VAT rate is 15%, retail, wholesale, and trade supplies can have varying rates. Here's a summary:
General VAT Rates:
- Standard: 15% (most goods and services)
- Reduced: 5%, 7.5%, 10% (specific goods/services)
- Zero-rated: Exports, potentially essential food/children's clothing
- Exempted: Some healthcare, education, and basic goods
Retail, Wholesale, and Trade Specifics:
- Traders: May be subject to a 5% VAT rate.
- For furniture showrooms, the VAT rate is 7.5% if they can provide proof (Mushak) that a 7.5% VAT rate was already paid during manufacturing. If such proof isn't available, the standard 15% VAT rate applies.
- Procurement Providers: Suppliers (non-manufacturers) charging 7.5% VAT and traders charging 5% to withholding entities are considered procurement providers, with a 7.5% VAT deduction at source (VDS) applied even if the charged rate is lower.
Key Considerations:
- The Value Added Tax and Supplementary Duty Act of 2012 is the governing law for these VAT rates, and the National Board of Revenue (NBR) can issue notifications to amend them.
- The VAT rate often depends on the specific goods and the supply chain stage (manufacturing vs. retail), not a uniform rate for the entire sector.
- Goods not under reduced rates may still be subject to the standard 15% rate at retail/wholesale.
- Detailed VAT rates are listed in official tables and schedules, often referencing H.S. codes.
- Standard 15% VAT applies to some trade-related services like freight forwarding and auctioneering.
In short, Bangladesh doesn't have a single VAT rate for all retail, wholesale, and trade. The rate (5%, 7.5%, or 15%) depends on the specific goods and potentially the business type. For accurate information, consult the official VAT regulations and NBR schedules.
Tags:
VAT& TAX (Corporate)