The National Board of Revenue has withdrawn value-added tax on commission indenting agents get in foreign currencies from overseas companies, officials said.
They said the revenue board had withdrawn 15 per cent VAT on the commission considering the indenting services as export of services.The NBR last week issued a statutory regulatory order in this connection.
Indenting agents get their commission in foreign currencies from overseas companies for working as their (overseas companies’) local agents and the commission are remitted to the country through the banking channel.
But many agents feel discourage to bring their commission in the country because of higher tax including 15 per cent VAT and 7.5 per cent advance income tax on the commission, indenting agents said.
‘Inflow of foreign currencies to the country will increase in the coming days because of the withdrawal of 15 per cent VAT on commission,’ former president of Bangladesh Indenting Agents Association Sahab Uddin Khan told New Age on Saturday.
Foreign earnings from the sector have been declining over the last few years after imposition of VAT on commission of indenting services, he said adding that earlier indenting service was VAT-free.
Few years ago, the revenue board had imposed 15 per cent VAT on the commission on services though exports of goods and services are exempted from VAT.
Indenting agents work for overseas companies, exporters, investors and consultants as agents for marketing their goods and commodities in Bangladesh.
They provide services to the importers on behalf of exporters and work to promote and sell the products of foreign companies in the local market in exchange for commission.
Though indenting agents also look after the interests of Bangladeshi importers through ensuring import of quality raw materials, machinery at a competitive price, they do not receive any commission from the local importers.
-With New Age input
