Tax waiver on LNG import to cause Tk 110b revenue loss

FT ONLINE

The National Board of Revenue (NBR) has estimated a total of Tk 110 billion loss in revenue collection after the government waived import taxes on Liquefied Natural Gas (LNG).

Officials said the gas sector is one of the largest revenue contributors to the national exchequer that may face a blow following withdrawal of Customs Duty (CD) and Supplementary Duty (SD) along with reduction of Advance Income Tax (AIT).

NBR has issued a Statutory Regulatory Order (SRO), dated September 30, 2018, waiving 5.0 per cent CD on import of LNG. The order came into force with retrospective effect from September 18, 2018.

In April 2018, NBR's Income Tax Wing reduced AIT on import of LNG to 2.0 per cent from 5.0 per cent.

Withdrawal of 93.24 per cent SD is also underway, officials said.

A senior NBR official said currently there are only 15 per cent Value Added Tax (VAT) at local transmission stage of LNG, and 2.0 per cent AIT on its import.

He said the import taxes have been cut in a bid to keep the prices of natural gas 'rational' in the local market.