However, speaking at different forums in the last few weeks, Muhith has hinted at relaxing the VAT rate. But will the new budget end up pacifying people with reduced VAT rate, or will it stay 15% causing more pressure on consumers? People with lower incomes and small business owners are already worried that the new VAT law will push up their cost of living. The 15% VAT is bound to hike the prices of daily commodities and raise living costs, he said. He suggested reducing the VAT rate to 10%, considering the per-capita income, since most countries in South and Southeast Asia have VAT rates below 15%.

Source: Dhaka Tribune May 31, 2017 19:41 UTC