High Court stays VAT on aviation charges for six months

High Court stays VAT on aviation charges for six months


It also issued a rule asking the authorities to clarify as to why the decision to impose the 15 percent VAT, collected by the Civil Aviation Authority, Bangladesh (CAAB), on services avail by the airlines should not be declared illegal and contradictory to VAT laws.

The National Board of Revenue (NBR) had scrapped a CAAB petition seeking rollback of the VAT imposed during 2009-10 financial year.

On July 28 this year, CAAB in a circular issued by Director (Air Traffic Service and Aerodromes) Mohammad Saeed Hossain Murady asked the airlines to pay the VAT on various aeronautical and non-aeronautical charges.

The VAT was imposed on landing, route navigation, security, boarding bridge, embarkation, and licence charges.

Nine airlines and two passengers filed the writ petitions.

Lawyer Shah Manjurul Haque, who argued for the airlines in the hearing, said NBR, CAAB and the other respondents were asked to give reply within four weeks.

He said the NBR imposed the tax though as per the Schedule No 2 of the Value Added Tax Act 1991, the services avail by the airlines were exempted from it.


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