National Board of Revenue (NBR) took a project involving more than Tk 600 crore for introducing the multiple VAT rates for businesses in 2012.
The objectives of the project were widening the tax net, easing the VAT system, improving compliance and reducing harassment of business owners.
As per the consultation of the project, the government introduced the multiple VAT rates for businesses in 2017, but it was suspended for two years following protests in the business community.
The multiple VAT rates were finally applied in 2019.
However, the tax net did not improve and remained stagnant at 9 percent in the tax-GDP ratio, the collection system has not been eased and the incidents of harassment to the business community increased, said FBCCI President Sheikh Fazle Fahim.
The incidents of harassment, especially to small businesses, by VAT officials have increased at the field level, Fahim said at a virtual press conference organised by the FBCCI, where the organisation gave its formal remarks on the proposed budget for fiscal year 2020-2021.
The VAT system became more complicated, although the NBR spent a lot of money on consultants to ease the system, he claimed.
He demanded an investigation into how the amendments of the VAT system increased the harassment instead of easing of the system for businesses across the country.