VAT Returns to Be Filed Every Tax Period Again

The government is set to restore the requirement for taxpayers to submit VAT returns after every tax period, replacing the current system that allows returns to be filed once every three tax periods.

The Cabinet on Monday gave final approval to the draft Value Added Tax and Supplementary Duty (Amendment) Ordinance, 2026, as part of efforts to make revenue collection more dynamic and strengthen VAT administration at the field level.

The approval was given at the 22nd Cabinet meeting held at the Bangladesh Secretariat, chaired by Prime Minister Tarique Rahman. The Internal Resources Division placed the draft before the meeting.

Under the proposed amendment, taxpayers will have to submit VAT returns within 15 days of the end of each tax period. This will replace the existing provision under which returns can be filed within 15 days after the end of every three tax periods.

If the 15th day falls on a government holiday, taxpayers will be allowed to submit their returns on the next working day.

The draft also provides additional time for certain categories of taxpayers. Government and semi-government offices, autonomous bodies, banks, insurance companies, and individuals or entities submitting zero returns will be allowed to file their VAT returns within 20 days of the end of the relevant tax period.

The government has proposed the amendment to Section 64 of the Value Added Tax and Supplementary Duty Act, 2012.

According to the government, the proposed change is aimed at accelerating revenue collection at the field level and making the VAT collection process more effective.

The Cabinet approved the draft subject to vetting by the Legislative and Parliamentary Affairs Division.

The return to periodic VAT filing is expected to provide revenue authorities with more regular information on business transactions and VAT liabilities, enabling closer monitoring of compliance.

The measure will also align the filing cycle more closely with the actual tax period, potentially allowing authorities to identify irregularities and outstanding liabilities earlier instead of waiting for returns covering several tax periods.

The draft ordinance will take effect after completion of the required legal procedures.