Bangladesh implemented Value Added Tax obligations on non-resident providers of digital services to its consumers on 1 July 2019. Generally, the reduced VAT rate of 5% applies – but there are many exceptions when the standard 15% is imposed (e.g. social media). VAT applies to both B2C and B2B transactions.
There is no requirement to appoint a Fiscal Representative. Follow VAT Calc’s global VAT and GST on digital services tracker for live updates on worldwide reforms.
What digital services are liable to Bangladeshi VAT?
Income from the following services are subject to VAT:
- Web hosting and support
- Images and texts
- E-learning (automated)
- Online gaming
- Download streaming music and videos
- SaaS or cloud-based software, plus downloads
- Online auctions
- Advertising and web listing
- Data processing and storage
The VAT obligations also extend to marketplaces and similar electronic platforms that enable their third-party providers to sell to Bangladeshi consumers and businesses.
VAT registration and compliance
VAT registrations with the National Board of Revenue can be done online.
Information technology-enabled services (ITES) are charged at the reduced VAT rate of 5%. However, the tax office is looking to extend the range of digital services subject to the standard rate of 15%.
Once VAT registered, most tax payers are subject to monthly returns. Filings must be submitted by the 15th of the following month.
Asia Pacific VAT on digital services
|Comments (click for details)||Rate||Date||Threshold||Comments|
|Australia||10%||Jul 2017||AUD $75,000|
|Armenia||20%||Jan 2022||AMD 115million|
|Bangladesh||5% - 15%||Jul 2019||–||B2B and B2C|
|Bhutan||7%||Jul 2021||Nu 5million|
|Cambodia||10%||Mar 2022||KHR 250m|
|China||6%-13%||N/a||Nil||Withholding VAT; B2B and B2C|
|Indonesia||11%||Aug 2020||IDR600m or 12k customers|
|Japan||10%||Oct 2015||JPY 10 million|
|Laos||7%||Feb 2022||LAK 400m|
|Nepal||13%||Jul 2022||Rupees 2m||Also 2% DST|
|New Zealand||15%||Oct 2016||NZD 60,000|
|Pakistan||2%||Sep 2021||Nil||Marketplace Withholding VAT|
|Philippines||12%||Jan 2024 ?||P 3million|
|Singapore||7%||Jan 2020||S$ 100,000|
|South Korea||10%||Jul 2015||Nil|
|Taiwan||5%||May 2017||NTD 480,000|
|Thailand||7%||Sep 2021||1.8m Baht|