Metro rail VAT exemption on tickets will continue: Govt

The exemption of value-added tax (VAT) on metro rail tickets will continue.

In addition, ahead of the upcoming holy month of Ramadan, the duties and taxes on the import of dates have been reduced.

The total tax incidence, previously 52.2 per cent, has now been brought down to 40.70 per cent.

These decisions were made today, Thursday, at a meeting of the interim government’s advisory council. The meeting was held at the Chief Adviser’s Office in Tejgaon, chaired by Chief Adviser Professor Muhammad Yunus.

In the afternoon, at a press conference at the Foreign Service Academy in the capital, the Chief Adviser’s Press Secretary, Shafiqul Alam, briefed reporters on the meeting’s decisions.

He said the withdrawal of VAT on metro rail would result in a loss of around Tk 400 million per year for the government. However, since metro rail is playing a groundbreaking role in Dhaka’s transportation, the VAT has been withdrawn.

In January, the National Board of Revenue (NBR) decided to extend the VAT exemption on metro rail tickets for another year. The exemption was set to remain in effect until 31 December. The government has now taken a fresh decision on the matter.

Under the current VAT law, a 15 per cent VAT is applicable on tickets for any air-conditioned rail service. The metro rail is fully air-conditioned and a form of mass transport.

However, from the very beginning of metro rail operations, VAT has not been imposed on this service at the request of its owner, Dhaka Mass Transit Company Limited (DMTCL).