The government has decided to substantially reduce the value added tax (VAT) on internet use.
Effective from Jul 1, internet users will have to pay 5 percent VAT, down from the existing 15 percent, Telecoms and ICT Minister Mustafa Jabbar told Bangla Tribune.
The new rate will be effective for all kinds of internet users — mobile and broadband.
“I went to the finance minister’s offices today (Monday) after the weekly Cabinet meeting, when signed the file,” Jabbar said before adding that the prime minister will officially announce it in parliament, when the budget for 2018-19 fiscal will be passed.
For the last seven years, all the trade bodies of digital and IT services have been urging the government to withdraw it but found no response from the policy makers.
According to industry insiders, the state coffer earns about Tk 11 billion in VAT on internet use.