15% VAT to be imposed on metro rail tickets from July

The National Board of Revenue (NBR) has decided to withdraw the tax exemption enjoyed by the Metro Rail authority from July this year.

To this end, NBR on Thursday sent a letter to Dhaka Mass Transit Company Limited (DMTCL), reports BSS.

At the letter, NBR said along with continuing to provide money for the huge development activities, graduation of the country from LDC and raising the tax-GDP ratio to the desired level, the exemption benefits given by taking into consideration the capacity of various sectors are being gradually withdrawn, i.e. the area of exemption is being narrowed.

The NBR had provided a VAT exemption on metro rail ticket prices last year, considering the service was not fully operational.

As per the law, a 15 percent VAT is applicable to both AC and non-AC railway services. As metro rail is fully temperature-controlled, a 15 percent VAT is applicable to this service.

After a 15 percent VAT imposition, the minimum distance ticket price will be Taka 23, up from Taka 20 currently, while the maximum distance ticket price will be Taka 115, up from Taka 100.