Free e-commerce from VAT to promote growth: Atiur
The government should exempt e-commerce payments from value-added tax for the next 3-5 years to help promote the sector, Bangladesh Bank Governor Atiur Rahman said yesterday.
“In Bangladesh, e-commerce is a promising sector. It is possible to waive VAT for e-trading since the government is making a new VAT law,” he said at the launch of a new platform for e-commerce traders in Dhaka.
The government may initially lose revenue due to the tax waiver, but in the long run, it will get higher revenue when e-commerce trading gains momentum, he added.
Bangladesh Association of Software and Information Services launched the platform -- BASIS E-Commerce Alliance -- at Bangabandhu International Conference Centre in Dhaka.
“It is a common platform for the stakeholders involved in the eco system of e-commerce,” said Shameem Ahsan, president of BASIS.
Logistic service providers, e-commerce organisations, financial institutions, digital marketers, Facebook and mobile commerce traders will be able to become members of the alliance, he added.
The alliance is an urgent need to promote e-trading by enhancing customer confidence, said Ahsan, who is also the chief executive of Akhoni.com, a leading online shop.
The platform will boost consumer confidence on online shopping in the country, he said.
The BASIS E-Commerce Alliance will take punitive action if any shopping portal -- that will be a member of the alliance -- undertakes any fraudulent activity against customers, and even return their money.
“It is a timely initiative. The platform is expected to boost growth of online shopping in the country, creating a linkage among all stakeholders,” said Kazi Akram Uddin Ahmed, president of Federation of Bangladesh Chambers of Commerce and Industry.
Bangladesh will see robust growth in online shopping due to the growing tech-savvy, young population, said AHM Mahfuzul Arif, president of Bangladesh Computer Samity.
Last year, Asia traded $650 billion on the e-commerce platform, up 36 percent from the previous year, he said.
Online shopping in India rose 8 times to $40 billion last year from 2012, he added.
e-commerce allows one to shop for virtually everything online. In Bangladesh, online shopping has yearly transactions worth around Tk 200 crore at the moment, growing by 30 percent a month, according to the BASIS president.
Online shopping gained momentum in 2011 after Bangladesh Bank cleared ways for payment by debit and credit cards in local currency.
An online portal offers a wide range of products, including kitchen items, apparel, gift items, furniture, electronic goods, home appliances and books.
Currently, the country has around 120 e-commerce sites and around 2,200 F-commerce (Facebook commerce) sites, said Ahsan.
AKM Fahim Mashroor, a former president of BASIS, will work as convener of the new e-commerce alliance.
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