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IT sector decries of duty burden

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Staff Reporter
Leaders of various IT organizations on Wednesday said that the 21.75 percent VAT and other surcharges im-posed on internet is becoming a burden on them.
Speaking at a joint press conference in the city, they demanded the tax be waived to make internet more affordable and accessible to the common people.
They put forward several recommendations which they hoped that the government will consider before approv-ing the national budget.
The IT organizations are - Association of Mobile Telecom Operators of Bangladesh (AMTOB), Bangladesh Association of Call Center & Outsourcing (BACCO), Bangladesh Association of Software and Information Services (BASIS), Bangladesh Computer Samity (BCS), Bangladesh Mobile Phone Importer Association (BMPIA), e-Commerce Association of Bangladesh (e-CAB) and Internet Service Providers Association Bang-ladesh (ISPAB).
They were critical of government move to lower tax on imported software from 25 percent to 5 percent, as it may discourage local software manufacturers from producing in future.
For Information Technology-enabled services (ITES), the rate of VAT deduction at source has been increased from 4.5% to 5%, which would discourage entrepreneurs and investors from this sector, they said.
Internet service providers complained that the existing 22.16 percent VAT is a big hindrance for development and investment in the area.
With the proposed VAT at source on computer parts, it would result in an 11 percent price increase on comput-ers and its spare parts from now on.
Mobile phone manufacturers complained that if 15 percent VAT is imposed, then locally-produced mobile phones would cost more than imported handsets.
AMTOB president TIM Nurul Kabir, ISPAB president MH Hakim, BMPIA president Ruhul Alam Al Mahbub, BASIS president Syed Almas Kabir and others also spoke during the occasion.