The new categories of goods and services which will come under VAT net include immigration advisers, soft drink, mineral water, toilet soap, restaurant, warehouse, port, land developers, building construction companies, telephone, tele-printers, telex, fax, internet service providers, SIM card distributors, cinemas, WASA, insurance companies, organisers of cultural programme participated by foreign artistes, health clubs, fitness centres, sports organisations, engineering firms, chartered planes and helicopter rental companies.

The goods and services will come under VAT net regardless of the amount of their annual turnover by withdrawing the existing turnover tax facilities, according to the budget speech by the finance adviser yesterday.

The finance adviser in his budget speech also proposed to impose VAT on the basis of truncated base value of the coaching centers, English medium schools, private medical and engineering colleges and private universities at the rate of 4.5 percent.

The same truncated base value facility has been extended to photo lab, courier services and air-conditioned bus services.

The adviser proposed to withdraw existing VAT exemption facility from ornamental fish, specialised doctors, lawyers and dental clinics.

The finance adviser proposed to adjust tariff values with the current market price in respect of items like chocolate milk, mango milk, banana milk, tomato paste, LP gas, paper, MS products, nail wares, chillers, electric transformers, human hauler, mechanised boats and ship scraps.

He also proposed to bring several amendments to the Value Added Tax (VAT) Act 1991 and the Value Added Tax Rules 1991.

As per the proposed amendments, the minimum penalty for tax evasion will be reduced to 25 percent from 50 percent of the evaded amount, while the maximum penalty will be reduced to 75 percent from 200 percent, said the adviser.

The maximum penalty for minor offences will be reduced to Tk 25,000 from Tk 50,000. The maximum penalty for major offences will be lowered to Tk 1 lakh from Tk 3 lakh.

The provision of annual renewal of VAT registration by commercial importers has been withdrawn. The ceiling of invested capital in plant machinery and equipment has been enhanced to Tk 7 lakh from 5 lakh as part of facilities extended to the cottage industry.