The rate
The standard rate in Bangladesh is 15%. Some goods and services carry reduced or zero rates and others are exempt. The difference matters: zero-rated sales still let you reclaim the tax on your purchases, exempt sales do not.
Who must register
Register for VAT above Tk 50 lakh (BDT 5,000,000) of annual turnover. Enlist for turnover tax from Tk 30 lakh (BDT 3,000,000) up to Tk 50 lakh. Below Tk 30 lakh, neither. Both figures date from 9 January 2025 and are much lower than the Tk 3 crore registration threshold most guides still quote. Turnover tax is 4% of turnover with no input credit and no decreasing adjustment; the Finance Act 2026 gave the government power to replace that with fixed sector-wise and region-wise amounts capped at Tk 2 lakh, but until it notifies them the 4% stands. The threshold does not apply at all to the categories in section 4(2), who register regardless of turnover. Voluntary registration is available under section 8.
How to register
Registration is required whatever the turnover for businesses in the groups listed in section 4(2) of the VAT and Supplementary Duty Act, 2012: supplying goods or services that carry supplementary duty, supplying under a tender, contract or work order, import-export business, branch, liaison or project offices of foreign entities, VAT agents, and activities in areas or goods the Board notifies.
A business that does not have to register can ask for voluntary registration under section 8, but it cannot apply for cancellation within one year of the registration date. Under section 9(7), after online registration the VAT officer visits to check the address, existence and activity, and can start cancellation if the address is not found or key information is false.
After registration, section 14 requires changes in prescribed business details to be notified. On cancellation under section 9(6), the business must stop issuing tax invoices, credit and debit notes at once, return the registration certificate, pay the arrears and file a final return.
Filing and paying
Registered and filed with National Board of Revenue (NBR).
Quarterly since 1 July 2026. A tax period is one calendar month, and the return covers every three tax periods and is due within 15 days of the end of the cycle — so the July-to-September quarter is due by 15 October. If the 15th is a public holiday you get the next working day. Government, semi-government and autonomous bodies, banks, insurance companies and anyone filing a nil return may take 20 days instead. You can still file monthly if you want to, voluntarily. Filing is online through eVAT at vat.gov.bd; manual returns were dispensed with from 1 July 2026. Manufacturers, service providers and traders claiming input credit file Form Mushak 9.1; everyone else — traders not claiming input credit, commercial importers supplying under final settlement, traders paying VAT on actual value addition — files the new Mushak 9.1.1, which does not allow input credit claims. Turnover taxpayers file Mushak 9.2. Supplementary duty is reported inside the VAT return, not separately.
Penalties for getting it wrong
Missing the return deadline is a flat Tk 2,000 under section 85, reduced from Tk 5,000. Failing to apply for registration or enlistment in time is Tk 10,000, and so is failing to display the certificate at your premises. Late payment attracts simple interest at 1% a month under section 127, running from the day after the due date to the day of payment and capped at 24 months, and it is payable on top of any fine, not instead of it. Section 65 lets the Commissioner permit a late return on application, but it cannot push the actual payment date out by more than one month and it does not touch the interest. Taking more input credit or a larger decreasing adjustment than you were entitled to costs between 30% and 50% of the amount — reduced from 50-100%.