Charitable bodies want VAT, source tax exemption

24 January 2021

Al Amin :
Different charitable and Non-Government organizations want Value-Added Tax (VAT) and source tax exemption from setting up religious institutions and conducting social activities in the country.
The charitable activities are setting up of Mosque, Madrasha, residence of orphanage, education related infrastructure, medical camp for poor patients, distribution of various commodities among the poor and helpless people and distribution of warm cloths among the clod-hit people, among others.
The charitable and non-profitable activities are conducted with the financial help of the different philanthropists of home and abroad. The necessary goods are being purchased from the local markets and implemented by the manpower of the respective organization.
Dr Muhammad Abdul Mazid, Former Chairman of the National Board of Revenue (NBR), said that the financial activities of the charitable organizations and NGOs are controlled under the NGO Affairs Bureau by the instruction of the NBR.
The board only gives approval in this regard, he added.
Like many other countries, in UK, the charitable organizations are enjoying zero per cent VAT on medical supplies and equipment, goods and aids for disabled people, rescue equipment and vehicles, such as ambulances and lifeboats, scientific equipment, advertising and construction and building work, which are used for helpful purpose.
Syed Aminul Kabir, former member of the NBR, told The New Nation, "Some NGOs in the country like Ahsania Cancer Hospital and Aga Khan Foundation are enjoying VAT and Source tax exemption facilities as the organizations are working only for helping people. So, anyone can take the facility by taking approval of the NBR."
Taking the facility, the organization must conduct their activities for complete charitable purpose, he added.
Like many other organizations, Kuwait Society for Relief (KSR) of Bangladesh office under signed by its Director General D Gazi Md Jahirul Islam sent an application to the NBR Chairman Abu Hena Md Rahmatul Muneem recently.
In the application, it said as all the activities of the organization are non-profitable and are being conducted for helping purpose. All the funds provided by the philanthropists are being used to implement the project as they provide only the main expenditure.
It is too difficult to implement project completely if the government takes VAT and Source tax from the amount of the different donors, the application said.
Under this circumstance, it will be not possible to run the charitable activities in the country if the government does not exempt VAT and source tax, it added.    
Following the application, the concern authority of the NBR is searching way to exempt VAT and source tax, officials said.

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