Tuesday, July 25, 2017 | ePaper

Burden of VAT on realtors

  • Print
THE impending 15 percent VAT on rod will take a huge toll on construction of buildings, particularly in rural areas, and increase the cost of infrastructure in the infrastructural deficient country. A daily reported that if every tonne of rod is priced at Tk 50,000, each customer will have to pay Tk 7,800 as VAT under the new law, up from Tk 900 now. As a result, the development of the rural housing sector, which accounts for about 30 percent of the country's total demand for iron bar, will grind to a halt. It seems that the uniform VAT clearly subdues the people's aspiration and need for standard living. If tax and VAT take all savings and income of people, how do the citizens make their life fortunate?
The 15 percent VAT slated to be imposed on all products and services from July 1 will increase the plights of citizens though the blindfolded Finance Minister could not perceive this. It is feared that the consumption of rod in rural areas may fall to about 2-3 lakh tonnes from the existing 15-18 lakh tonnes. While the domestic steel mills growth became stable by manufacturing 50 lakh tonnes of steel a year, the government imposed deterrent will put the sector in disequilibrium and increase infrastructural deficiency across the country.
The VAT will also increase electricity bills for manufacturing the iron bars and the spending on raw material imports, all of these will ultimately affect the rod price. The new VAT will increase the government's revenue earnings from the sector but the industry will be squeezed and the people will be pinched. Rod prices began increasing just after the announcement of the proposed budget for fiscal 2017-18 on June 1. It is illogical to impose VAT on key building materials when the government is exempting VAT on manufacturing of luxury goods like refrigerators and air conditioners.
The infrastructure and other construction projects of the government account for 40 percent of the country's demand for rod, followed by private builders in urban areas, who use the rest 30 percent, and both will also suffer.  People accept the government's role as a   Social Contract where people pay tax and government provide facilities in exchange of tax, but the very notion of state is absent in our country. The government is apathetic to people's suffering which is illegal, irrational and unethical.

More News For this Category

Monopolistic contract with Reliance of India is damaging

AS PER a national daily, Indian conglomerate Reliance has set a time-bound action plan for the government to expedite signing of unsolicited contracts with it for import of liquefied

They are only self-seekers and have no love for Bangabandhu

WHEN there are so many critically important national issues to be addressed - some of our politicians needlessly makes a mountain out of a mole hill by creating pointless

Migrants fall easy prey to human traffickers

Baher Kamal :Every single day, print and online media and TV broadcasters show images and footage of migrants and refugees adrift, salvage teams rescuing their corpses-alive or dead, from fragile

How to achieve universal goals, strategically

Roshni Majumdar  :Discussion around the 2030 Agenda for Sustainable Development, a list of 17 goals listed by the UN, was all the buzz in the conference rooms of UN headquarters

Prepare now for next financial crisis, if any

Martin Khor :The Asian financial crisis started 20 years ago and the global financial crisis and recession 9 years back. When a new global financial crisis strikes, the developing countries

Readers’ Forum

Life drowning in ChittagongLife has come to a standstill for the people of Chittagong, They are passing their days in unbearable sufferings as the city is drowning.There are many reasons

Recurring landslides in hills kill people but nobody cares

SPEAKERS at a seminar in the capital on Friday called for the protection of the environment in the country's hilly areas by taking up of long-term plans to tackle

Dhaka needs more space to ease traffic congestion

ACCORDING to a report published by a renowned foreign specialist and a researcher on modern Dhaka - it was revealed that one of the main reasons for increased congestion

Engaging civil society more actively in SDG execution

Tharanga Yakupitiyage  :Showing up in record numbers, civil society groups are urging greater inclusion and accountability in sustainable development processes at a UN high level meeting.Almost 2,500 representatives are currently

Highway during monsoon

Dr. Md. Shairul Mashreque  :The much-awaited four-lane Dhaka-Chittagong highway  have been ready for use long back.  It was inaugurated by Prime Minister Sheikh Hasina ..  The four-lane Dhaka-Chittagong highway was