VAT to halt e-commerce growth: BASIS

Imposing VAT on online purchase may halt the growth of the booming e-commerce sector, said stakeholders.

“E-commerce and online transaction is gaining popularity and is also on the government’s priority list,” said Syed Almas Kabir, president of Bangladesh Association of Software and Information Services (BASIS).

“If the government wants to see this sector progress, imposing VAT on it will not be a wise move,” he said at a roundtable discussion on Wednesday.

On Tuesday, ICT State Minister Zunaid Ahmed Palak also demanded VAT exemption for e-commerce businesses.

In the proposed budget for FY2019-20, the government slapped 7.5 percent VAT on online purchase.

The BASIS president called upon the government to exempt VAT for this sector at least for another five years.

Senior Vice President of BASIS Farhana A Rahman said: “People have started getting used to e-commerce. Because of the 7.5 percent VAT, commodities on online sites will cost more, discouraging buying and selling on the virtual marketplace.”

On Tuesday, Palak also said the sector had started getting matured. However, it is not yet at a level that VAT could be earned from the sector.

Among others, General Secretary of e-Commerce Association of Bangladesh (e-CAB) Md Abdul Wahed Tomal and Director In-Charge of BASIS Digital Commerce Standing Committee Didarul Alam participated in the discussion.

BASIS Digital Commerce Standing Committee Chairman Syed Mohammad Kamal, Co-Chairman Ashikul Alam Khan, Co-Chairman Zeeshan Kingshuk Huq, and high officials of bKash, Rocket, Uber, Pathao, Ipay System Limited, ShurjoMukhi Limited, PriyoShop.com, Sindabad.com, AjkerDeal.com, Bagdoom.com, Othoba.com, Chaldal.com, Hungrynaki.com, Iferi.com, Gemsclip.com, Pickaboo.com, Rokomari.com, Property Bazaar Limited, Deligram, Sheba xyz, Evaly and e-Courier were present.