The government is considering exempting 15 per cent VAT on land mutation fees as its justification has come into question.
There is one kind of tax, which the local government department collects as land mutation fees.
The government is reviewing the legitimacy for slapping the VAT and the authorities termed it 'double taxation.'
The decision came after the Land Reforms Board sought an intensive review of the VAT in a cabinet meeting held earlier.
In a recent meeting, the National Board of Revenue, or NBR, decided to act on the basis of recommendation from the ministry of land.
The imposition of 15 per cent VAT on the same mutation fees can be considered a 'double tax,' representatives of the Land Reforms Board told the cabinet meeting.
Tax officials said although the amount of VAT is insignificant, they have taken it seriously considering the sensitivity of the issue.
People from all walks of life are involved in land-related services.
Currently, people are required to pay Tk 1,150 per document as land mutation fees.
Consumption tax on land mutation fees is imposed under the 1991 and the new 2012 law.
Currently, there is no VAT on land registration, sale or transfer, except for land development authority or building construction agencies.
The withdrawal of VAT on land mutation fees is a long-standing demand of the board.
The board placed the issue before the Cabinet on March 23, 2017 seeking its review.
The cabinet meeting, chaired by its then secretary Mohammad Shafiul Alam, instructed the departments and agencies to hold an inter-ministerial meeting on reviewing the justification and legitimacy for imposing VAT on land mutation fees.
The cabinet also asked the NBR to discuss the matter with the departments, agencies and ministries concerned before it slaps VAT on public sensitive issues.
The NBR, on December 24, 2019, held an inter-ministerial meeting after the cabinet division's inquiry.