VALUE ADDED TAX ACT, 2011 ACT NO. X OF 2011 Table of Contents CHAPTER 1 ... PDF
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VALUE ADDED TAX ACT, 2011 ACT NO. X OF 2011 Table of Contents CHAPTER 1 PRELIMINARIES 1. Short title and commencement.— 2. Dictionary.— 3. Principles of interpretation.— 4. Associate.— 5. Consideration.— 6. Economic activity.— 7. Fair market value.— 8. Resident and non-resident.— CHAPTER 2 REGISTRATION AND ENLISTMENT 9. Persons required to be registered 10. Voluntary registration.— 11. Separate registration of branches and divisions .— 12. Applications for registration.— 13. Compulsory registration.— 14. Obligations of registered persons.— 15. Cancellation of registration.— 16. List of persons registered.— 17. Enlistment of turnover taxpayers.— CHAPTER 3 IMPOSITION OF VALUE ADDED TAX 18. Imposition of Value Added Tax.— 19. Person liable to pay VAT.— 20. Zero-rating.— 21. Exemptions.— 22. Exemptions and rates only as provided by law.— 23. This Act to over-ride other laws purporting to provide exemptions from tax.— CHAPTER 4 VAT ON IMPORTS 24. Payment and collection of VAT on imports.— 25. Value of Import.— 26. Value of returning goods.— 27. Import without entry for home consumption.— 28. Advance payment at time of import.— New VATA 9-Jan-11 2 CHAPTER 5 VAT ON SUPPLIES Part A – General 29. Supply.— 30. Taxable supply.— 31. When VAT becomes payable on supplies.— 32. Value of supply.— 33. Progressive or periodic supply.— 34. Single and multiple supplies.— Part B – Special cases 35. Sale of an economic activity as a going concern.— 36. Rights, options, and vouchers.— 37. Prepaid telecommunications products.— 38. Lotteries, lucky draws, raffles, and similar undertakings.— 39. Value of in-kind benefits given to an employee or office-holder.— 40. Lay-by sales.— 41. Cancelled transactions.— 42. Sale of property in satisfaction of a debt.— 43. Vending machines.— CHAPTER 6 PLACE OF TAXATION Part A - Explanation 44. Destination principle.— Part B – Supplies made in Bangladesh 45. Supply by a resident 46. Supply by non-resident established in Bangladesh 47. Supply by non-resident not established in Bangladesh 48. Supplier and recipient registered 49. Water, gas, oil, electricity, or thermal energy.— 50. Progressive or periodic supplies.— 51. VAT representatives of non-residents.— 52. Imported services reverse charged to recipient.— Part C – Supplies for consumption outside Bangladesh 53. Land outside Bangladesh.— 54. Goods supplied for consumption outside Bangladesh.— 55. Services supplied for consumption outside Bangladesh.— Part D – Special cases 56. Travel agents and tour operators.— CHAPTER 7 CALCULATION AND PAYMENT OF TAX FOR TAX PERIOD Part A - Calculation and payment of net tax payable 57. Payment of VAT payable on supplies.— 58. Adjustments increasing the amount payable.— New VATA 9-Jan-11 3 59. Adjustments decreasing the amount payable.— 60. Extension of time to pay.— Part B –Withholding 61. Withholding of VAT by recipient.— 62. Supplier‘s adjustment for VAT withheld.— Part C – Input tax credits 63. Credit for input tax.— 64. Prohibition on input tax credits.— 65. When input tax credits may be claimed.— 66. Partial input tax credit.— Part D – Other adjustments 67. Post-supply adjustments for adjustment events.— 68. Post-supply adjustments for bad debts.— 69. Payment not made through banking channels.— 70. Adjustments for assets applied to a private purpose.— 71. Adjustments on becoming registered.— 72. Adjustments on cancellation of registration.— 73. Adjustments for second-hand goods purchased for re-sale.— 74. Adjustments relating to insurance.— 75. Adjustments relating to lotteries, lucky draws, raffles, and similar undertakings.— 76. Adjustments when rate changes.— CHAPTER 8 TAX INVOICES AND OTHER DOCUMENTS 77. Tax Invoices.— 78. Credit and debit notes.— 79. Withholding certificates.— 80. Requests for VAT documentation.— 81. Documentation issued by or to agents.— 82. Prohibitions.— CHAPTER 9 SUPPLEMENTARY DUTY 83. Imposition of supplementary duty and person liable. 84. Person liable to pay supplementary duty.— 85. Dutiable value.— 86. Special schemes for tobacco and alcohol.— 87. Payment and collection of supplementary duty on imports.— 88. Payment and collection of supplementary duty on supplies.— 89. Deemed supply of dutiable goods.— 90. Decreasing adjustments for supplementary duty paid.— CHAPTER 10 TURNOVER TAX 91. Imposition of turnover tax.— New VATA 9-Jan-11 4 CHAPTER 11 RETURNS 92. VAT returns.— 93. Turnover tax returns.— 94. Late filing.— 95. Amended returns.— 96. Minor corrections.— 97. Fuller, additional, or alternative returns.— CHAPTER 12 REFUNDS 98. Carry forward and refund of negative net amount for a tax period.— 99. Refunds without carry forward.— 100. Application and payment of refunds.— 101. Refunds to diplomats, non-profit bodies, and other international bodies.— 102. VAT or turnover tax erroneously overpaid to be refunded by adjustment.— CHAPTER 13 ASSESSMENTS 103. Assessments.— 104. Assessment of recipient of supply.— 105. Misrepresentation by supplier.— 106. Negation of tax benefit from a scheme.— 107. General provisions relating to assessments.— CHAPTER 14 ADMINISTRATION 108. Value Added Tax Department, Authorities, and Officers.— 109. Powers and Duties of Value Added Tax Officers 110. Delegation of Power— 111. Assistance to VAT Authorities.— 112. Assistance by VAT Authorities.— 113. Power to issue Summons.— 114. Power of Adjudication.— 115. Powers and duties of the Commissioner of Customs.— 116. Confidentiality.— CHAPTER 15 AUDIT, INVESTIGATION, AND ENFORCEMENT 117. Audit and Investigation of Taxpayer‘s Tax Affairs.— 118. Powers of VAT Officers.— 119. Provision of general information.— 120. Supervised supply, Observation and Surveillance.— 121. Special audit.— 122. No multiple departmental audits in normal circumstances.— New VATA 9-Jan-11 5 CHAPTER 16 COLLECTION AND RECOVERY 123. Recovery of tax.— 124. Officer of the Value Added Tax Department to act as Court in recovery matters.— 125. Change in jurisdiction for recovery.— 126. Allocation of payments.— 127. Power to require security.— 128. Execution against Taxpayer‘s Property.— 129. Sale of Seized Property.— 130. Third Parties.— 131. Indemnity.— 132. Transferees.— 133. Liabilities and obligations of representatives.— 134. Duties of Receivers.— 135. Directors of companies.— 136. Representatives of associations of persons.— 137. Continuity of partnerships or unincorporated associations.— 138. Death or insolvency of registered person; mortgagee in possession.— 139. Recovery of VAT from persons leaving Bangladesh.— 140. Instalments of arrears.— CHAPTER 17 FORMS, NOTICE AND RECORD-KEEPING 141. Records and accounts.— 142. Forms, notices, and authentication of documents.— 143. Service of notices.— 144. Validity of documents.— CHAPTER 18 INTEREST, OFFENCES AND PENALTIES Part 1: Interest 145. Imposition of interest for late payments.— Part 2: General provisions 146. Penalties.— 147. Sanction for prosecution.— 148. Power to compound offences.— 149. Trial by Special Judge.— 150. Special Jurisdiction of Special Judge.— 151. Penalties or offences for acts or omissions by companies.— 152. Aiding and abetting.— 153. Independence of penalties and offences.— 154. Fines and penalties are in addition to tax payable.— Part 3: Offences and Penalties 155. Authority for imposition of fine, penalty and imprisonment.— 156. Offences relating to registration.— 157. Offences relating to enlistment.— New VATA 9-Jan-11 6 158. Failure to file return.— 159. Default surcharge and penalties for late payment.— 160. Understatement of tax payable or improper claim for refund.— 161. False Documentation or VRN.— 162. Failure to keep records.— 163. Failure to provide facilities.— 164. Obligations imposed on specified persons.— 165. Offences relating to withholding.— 166. False or misleading statements.— 167. Failure to pay security.— 168. Impeding tax administration.— 169. Tax evasion.— 170. General penalty.— CHAPTER 19 APPEALS, REVISIONS AND REFERENCE 171. Appeal to Commissioner (Appeal).— 172. Power of the Board to call for records and rectify errors.— 173. Appeal to Appellate Tribunal.— 174. Reference to the High Court.— 175. Restrictions.— 176. Alternative dispute resolution.— 177. Bar of suits, prosecution and other legal proceedings.— 178. Appearance by authorised representative and licensed VAT consultant.— 179. Correction of clerical errors, etc.— 180. Bar to the jurisdiction of the Courts. 181. Evidence and burden of proof.— CHAPTER 20 MISCELLANEOUS 182. Online filing and payment etc 183. Attested copies of documents. 184. Currency.— 185. Tax Clearance Certificate and VAT Honour Card.— 186. Translation of records.— 187. Reward.— 188. Rules.— 189. Establishment of accounts for refunds and rewards.— CHAPTER 21 TRANSITION 190. Repeal.— 191. Transition.— 192. Accounting rules for transition.— 193. Agreements entered into after VAT announced.— New VATA 9-Jan-11 7 FIRST SCHEDULE SECOND SCHEDULE THIRD SCHEDULE New VATA 9-Jan-11 8 VALUE ADDED TAX ACT, 2011 ACT NO. X OF 2011 [DATE] An Act to consolidate the law relating to value added tax, supplementary duties, and turnover tax WHEREAS it is expedient to consolidate the law relating to the imposition and collection of value added tax, supplementary duties, and turnover tax so as to transform the value added tax into a broad based transaction tax, the burden of which falls on final consumption in Bangladesh, and to provide for allied matters; It is hereby enacted as follows:— CHAPTER 1 PRELIMINARIES 1. Short title and commencement.— (1) This Act may be cited as the Value Added Tax Act, 2011. (2) It extends to the whole of Bangladesh and, except as provided in subsection (3), comes into force on such date as the Government may, by notice in the Official Gazette, appoint. (3) Chapter 2 and sections [others to be specified once final draft is ready for submission to Parliament] come into force on the date on which this Act receives Presidential assent. 2. Dictionary.— In this Act, unless the context indicates otherwise,— (1) ―adjustment event‖ has the meaning given in section 67(1); (2) ―advance tax‖ means the tax payable on a taxable import under section 28; (3) ―aircraft‘s stores‖ has the meaning given in section 54; (4) ―AIT‖ means advance income tax payable under the Income Tax Ordinance, 1984; (5) ―ancillary transport services‖ means stevedoring services, lashing and securing services, cargo inspection services, preparation of customs documentation, container handling services, and the storage of transported goods or goods to be transported; New VATA 9-Jan-11 9 (6) ―Appellate Tribunal‖ means the Customs, Excise, and Value Added Tax Appellate Tribunal formed under section 196 of the Customs Act, 1969; (7) ―apply to a private use‖ has the meaning given in section 70; (8) ―approved non-profit body‖ means a person designated as such in the Rules; (9) ―assessment‖ includes a self-assessment, an amended assessment, and a nil assessment and means the entering into the records of the Department of the amount of a taxpayer‘s liability to pay, for a specific tax period, any or all of the following (a) VAT (including VAT withheld from another person); (b) supplementary duty; (c) turnover tax; (10) ―asset‖ means any personal or immoveable property, whether tangible or intangible; (11) ―associate‖ has the meaning given in section 4; (12) ―association of persons‖ includes a partnership, a trust, a Hindu undivided family, and a body of persons formed, organized, established, or recognised in Bangladesh or elsewhere, but does not include a company or an unincorporated joint venture; (13) ―authorised officer‖, with respect to a function, means the officer of the Department authorised to carry out that function; (14) ―Bill of Entry‖ means a bill of entry as defined in section 2(c) of Customs Act, 1969 (IV of 1969); (15) ―Board‖ means the National Board of Revenue constituted under the National Board of Revenue Order, 1972 (PO no. 76 of 1972); (16) ―capital asset‖, in relation to something acquired or imported by a person, means an asset, whether tangible or intangible, which has a useful life that is estimated to extend over a period longer than one year, but does not include: (a) consumables or raw materials; or (b) an asset acquired for the principal purpose of resale in the ordinary course of carrying on the person‘s economic activity, whether or not the asset is to be sold in the form or state in which it was acquired; (17) ―commencement day‖ means the day on which this Act comes into force under section 1(3); New VATA 9-Jan-11 10 (18) ―commercial accommodation‖ means— (a) accommodation in a building (including part of a building or a group of buildings) operated as a hotel, motel, inn, boarding house, guest house, hostel, or similar establishment in which lodging is regularly or normally provided to four or more persons for a periodic charge; or (b) other accommodation offered for short term occupation by individuals other than as their main residence; (19) ―Commissioner of Customs‖ means the individual appointed to that position under section 3 of Customs Act, 1969; (20) ―company‖ means an incorporated body or association of persons formed, organized, established, or recognised under a law in force in Bangladesh or elsewhere; (21) ―consideration‖ has the meaning given in section 5; (22) ―control‖ has the meaning given in section 4(5); (23) ―credit note‖ means a document that a supplier is required to issue under section 67; (24) ―customs laws‖ means Customs Act, 1969 and any other law relating to customs, and includes a proclamation, rule, resolution, or order made under the authority of a law relating to customs; (25) ―debit note‖ means a document that a supplier is required to issue under section 67; (26) ―Department‖ means the Department of Value Added Tax established under this Act; (27) ―Divisional Officer‖ means a VAT Officer, not being an officer below the rank of Assistant Commissioner,— (a) who is in charge of a Value Added Tax Divisional Office (including the Large Taxpayers Unit of Value Added Tax); or (b) who is assigned to discharge a function of such Divisional Officer; (28) ―document‖ includes— (a) anything expressed or stated with the help of a letter, number, symbol or sign on paper or any other material; and (b) any kind of electronic data, computer program, computer tape, computer disk, or other kind of media that holds data; (29) ―dutiable goods‖ means goods specified in the Third Schedule; (30) ―dutiable services‖ means services specified in the Third Schedule; New VATA 9-Jan-11
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