The government has withdrawn the additional 5 percent value added tax or VAT on broadband internet services which 15 percent was before.
All the parties involved in this process will now get the 5 percent VAT that Internet customers used to pay.
The Ministry of Finance has issued a notification exempting 5 per cent VAT on International Terrestrial Cable (ITC), Internet Gateway (IIG) and Network Transmission Service (NTTN) services.
ISPAB, an organization of broadband internet service providers, had threatened to shut down the internet for some time if the VAT crisis in the broadband internet sector is not resolved. About a month and a half after their threat, the finance ministry released a gazette on Thursday (August 26th).
The circular has told that in the case of International Terrestrial Cable (ITC), International Internet Gateway (IIG) and Nationwide Telecommunication Transmission (SNT) 5 per cent in the value of sub-section 1 of section 128 of the Value Added Tax and Supplementary Duty Act, 2012. Exemption from value added tax. As a result, broadband internet service providers are freed from the burden of additional VAT.
In this regard, ISPAB Secretary Emdadul Haque said that the implementation of this decision will end the VAT complexity. However, there will be no impact on customers. In the case of service providers, this VAT has been reduced. As a result, internet service providers will be able to offset the losses and the money they had to pay for additional VAT will be able to provide better services to customers by investing in this sector.
According to ISPAB, more than 6 million homes across the country currently have wired internet connections and about 35 million broadband subscribers.