No VAT on remittance
NBR clears rumours
Rumours were spread to encourage remittance to be sent through illegal channels
No value added tax (VAT) has been slapped on inward remittance, the National Board of Revenue said yesterday.
The tax administrator said rumours have been going round the social media on VAT being imposed on remittance in the proposed budget for 2018-19.
“It is completely untrue,” the revenue watchdog said in a statement signed by its spokesperson Syed A Momen.
“It may be that this misinformation has been spread with an ill-motive of encouraging remittance to be sent through the illegal hundi channel instead of the formal channel,” the statement reads. The NBR said remittance was treated as service export and no VAT was applicable on remittance irrespective of the amount.
“So non-resident Bangladeshi can send any amount of remittance or foreign currency through the formal banking channel,” said the NBR. “Money sent through illegal channels cannot play a role for the national economy.”
The NBR recommended non-resident Bangladeshis refrain from sending money through hundi.
Taxmen said the government encourages remittance inflows and the tax authority has never imposed any tax on remittance inflows.
Remittance, sent by nearly one crore migrant Bangladeshi workers, is the second biggest source of foreign currency after export receipts.
Remittance inflows rose 17 percent year-on-year to $13.57 billion in July-May period of the current fiscal year, according to Bangladesh Bank.