Restaurant owners demand VAT cut

Restaurant owners have demanded that the government reduce the value-added tax (VAT) proposed in the fiscal 2021-22 budget as payable by all restaurants, be it of a lower category, moderate or fine dining.

Organising a press conference at their Purana Paltan office yesterday, Bangladesh Restaurant Owners Association (Broa) expressed their opinions on the budget and informed of various crises of the sector.

"The proposed budget for 2021-22 FY mentioned to pay 15 per cent VAT for AC and 5 per cent for non-AC restaurants," said Broa Secretary General Imran Hasan.

"However, we demand highest 3-5 per cent VAT for lower and moderate category restaurants and street food, and 7.5 per cent VAT for fine dining restaurants," he said.

"Earlier, the non-AC restaurants had to pay 7.5 per cent VAT. The AC and non-AC categories should be abolished for VAT payment as AC is a general necessity nowadays," he added.

However, Broa proposed a 15 per cent VAT for five and four-star category hotels and restaurants and a 2 per cent VAT for canteens or cafeterias of educational institutions, hostels and industrial factories.

The VAT on restaurants' rent can be fixed at a maximum 3 per cent, the association leader said.

The restaurant owners also claimed that young locals from ward councillor offices were extorting restaurants accusing them of not using electronic fiscal devices (EFD) provided by the National Board of Revenue.

"The authority should set up EFD machines in all restaurants," said Hasan.

Their other demands include formulating a policy for online food delivery services and setting the highest 10 per cent as their commission, and providing stimulus loans at 4 per cent interest or monthly food assistance for the sector's workers.

They also sought declaring the sector as an industry and ensuring vaccination of their staff within September this year.

The country has around 60,000 restaurants and around 30 lakh people are employed in the sector, according to Broa.