Bangladesh withdraws VAT on tuition fees amid student protests

In the face of continuous student protests in Dhaka and other cities, the government has finally withdrawn the 7.5 percent VAT on private universities as well as medical and engineering colleges.

The National Board of Revenue (NBR) issued a special order to this end last night, with retrospective effect from June 4, the day the government imposed the VAT in the current budget.

The NBR said the cost of education in private universities and medical and engineering colleges was already high and imposing the VAT would further increase the cost.

“Therefore ... the service of private universities and medical and engineering colleges are being exempted from the value added tax (VAT),” the order said.  

Earlier in the afternoon, the finance ministry announced through a press release the government decision to lift the VAT.

Private university students greeted the decision with joyous rallies, flashing victory signs.

They had been agitating on the streets in Dhaka and elsewhere since Wednesday, demanding withdrawal of the VAT.    

Yesterday, they called off their demonstrations and returned to the campus on hearing the government decision from journalists, even before the official announcement by the ministry and the NBR.

The ministry said the government did not want to create obstacles in the educational institutions and cause public sufferings.

"Considering the issue from this angle, the government has decided to withdraw 7.5 percent VAT imposed on private universities, medical colleges and engineering colleges in the fiscal year 2015-16," said the press release, signed by finance ministry's Senior Information Officer Shahedur Rahman.

Terming it a victory, the students thanked Prime Minister Sheikh Hasina for understanding their fair demand. They also offered apologies to the city dwellers for the troubles caused by their street programmes.

"We are extremely happy that the prime minister accepted our demand. We will go back to our classes," said Nowshin, a BBA student of Daffodil University.

The Association of Private Universities of Bangladesh also thanked the PM for lifting the VAT. In a statement, it urged students to return to classes.

Earlier in 2010, the government imposed a 4.5 percent VAT on tuition fees of private universities. The decision triggered a huge uproar and the students took to the streets in protest. Following days of demonstration, the government lifted the VAT.

YESTERDAY'S PROTEST, ATTACK

As planned, several thousand students occupied the streets at different parts of the city, including Rampura, Gulshan, Banani and Uttara, yesterday as they did on Thursday and Sunday to press home their demand.

They sat on the roads and chanted anti-VAT slogans. Traffic was disrupted as students choked the roads, causing sufferings to many.

Around 10:30am, students of East West University blocked the street between the Rampura bridge and Merul Badda. Vehicular movement came to a near halt for several hours there.

BRAC University students brought out a procession from their campus in Mohakhali around 11:00am. The protesters blocked the road between Mohakhali and Gulshan-1 intersection disrupting traffic.

Students of Stamford University, University of Liberal Arts, United International University and University of Asia Pacific blocked Satmasjid road around 11:15am.

Daffodil and other university students occupied Dhanmondi-27 road and stayed for several hours.

"We will not budge a bit until our demand is met," one protester said.

In Uttara, students of Asian, Shanto Marium, BGMEA and Uttara universities demonstrated at the House Building intersection. That disrupted traffic on the road connecting Dhaka to the highways leading to Tangail and Gazipur.

Meanwhile, alleged Chhatra League activists of Titumir College attacked the demonstrators at Kakoli, leaving at least seven private university students injured.

Students said they were demonstrating peacefully on Airport Road around 11:30am when the BCL men came in three buses.

At one point, a bus tried to drive over the demonstrators deliberately. The BCL activists also came down from the bus and punched and beat them with sticks, said the students, asking not to be named.

The injured were rushed to a hospital at Mohakhali for primary treatment, they added.

Later, more students joined the anti-VAT demonstration and blocked the road with sticks and iron rods in their hands.

Vehicular movement on the road remained halted till 2:45pm.

Contacted, Mirajul Islam Mahfuz, organising secretary of Titumir College BCL unit, claimed it was the anti-VAT demonstrators who attacked them.

"We just chased them," he said, adding that their activists were going to their campus at Mohakhali when the anti-VAT demonstrators threw stones on their buses.

In Chittagong, hundreds of students of different private universities blocked two roads for an hour.

The students gathered at Wasa intersection of CDA Avenue around 11:15 am and blocked the road, stopping traffic on both sides of the road.

'VICTORY FOR EDUCATION'

Students began celebrating just after noon following media reports that the government decided to lift the VAT. Soon, they left the streets and returned to their campus in a festive mood.

"It's a victory for education," said Rummon of Stamford University.

"We had no alternative and that's why we took to the streets. But we are grateful to the people who supported our demand despite the troubles on the road,” he said.

The students urged the government to strictly monitor the private universities so the authorities cannot hike the fees at will.

The anti-VAT demonstration intensified after police fired rubber bullets on students of East West students on Wednesday. The next day, private university students poured into streets, virtually paralysing the capital.

In the face of their protest, the government on Thursday “clarified” that the VAT would be collected from the universities, not from the students.

The students rejected the explanation, saying the universities would eventually charge them, and called a three-day strike. After a break on Friday, they blocked key streets in Dhaka for the last three days.

Protests spread in other parts of the country, including Rajshahi, Chittagong and Sylhet.