Real estate sector to be worst sufferer by new VAT law: REHAB

Realtors on Saturday said the proposed national budget for 2017-18 fiscal is not friendly for the country's real estate sector as it will face a debacle if the new VAT law is implemented, reports UNB.

"The 15 percent VAT on the purchase of flats and plots will leave dire negative impact on the sector,” said president of Real Estate and Housing Association of Bangladesh (REHAB) Alamgir Shamsul Alamin at a press conference at a hotel in the capital.

REHAB’s senior vice president Nurun Nabi Chowdhury (Shaon) MP, vice president Liakat Ali Bhuiyan, its directors Kamal Mahud, Md Jahir Ahmed and Al Amin, among others, were present on the occasion.

The REHAB president said the VAT on flat is now on average 3 percent (1.5 percent-4.5 percent), which is going to increase to be 15 percent in the upcoming fiscal year, which will invite negative impacts for the real estate sector.

He said the sector will be the worst sufferer by the new VAT law.

Noting that the sale of flat and plot declined by 80 percent in the country, he said there is no reflection of any demand of REHAB in the proposed budget announced by the finance minister in parliament on 2 June.

Nurun Nabi Chowdhury MP said following imposition of additional tax in the proposed budget, the prices of five construction materials - rod, cement, brick, stone, and sand - will go up which would invite a dire consequence for the sector.

Claiming that there are 20 million people are directly or indirectly engaged in the real estate sector, the REHAB leaders demanded that the new VAT law should not be enforced in the sector for the sake of development of the country.