Revenue authority has waived VAT on local lift manufacturing and parts import
The National Board of Revenue (NBR) has waived VAT on local lift producing, production of capital machineries and elevator parts to encourage the local elevator manufacturers.
The VAT wing of the revenue board recently issued two separate statutory regulatory orders (SROs) signed by NBR Chairman Abu Hena Md Rahmatul Muneem.
All kind of Value Added Tax (VAT), Supplementary Duty (SD) and regulatory duty except Advance Tax have been withdrawn from elevator parts collection and import to encourage the local lift manufacturing, says the SRO.
Currently, local manufacturers have to pay 10 percent customs duty for equipment and raw materials needed to produce elevators, whereas finished products carry only 1 percent duty.
The revenue board in the SRO has imposed some conditions including quality control, taking prior permissions and using specific parts for lift-making.
Earlier in March, local electronics giant Walton Group flagged off the country's first lift manufacturing plant. However, RFL Group has been assembling elevators for couple of years responding to growing number of high-rise buildings in Bangladesh.
According to available data, Bangladesh needs more than 5,000 units of lifts every year and most of them are imported from China.
The market size is not less than Tk 1,200 crore and it is growing at about 20 percent per year propelled by fast-growing cities.
The revenue board in its SRO says the local manufacturer will have to take permissions from the Bangladesh Investment Board, Bangladesh Economic Zones Authority, Bangladesh Hi-Tech Park Authority and NBR.
According to the NBR circular, locally manufactured parts must have 30 percent added value to them to avail the VAT waiver.