The National Board of Revenue has moved to realise value-added tax from subscriptions of online streaming sites such as Netflix, Amazon Prime, ZEE5, Hoichoi and HBO Now. A 15-per cent VAT is applicable on the fees that subscribers pay to the online entertainment sites. As part of the move, the NBR’s VAT intelligence and Investigation Directorate has requested the Bangladesh Bank to instruct the commercial banks to deduct the applicable VAT from the fees while remitting it abroad on behalf of the subscribers. Clients usually make the fee payment through credit cards. VAT intelligence director general Syed Mushfequr Rahman made the request in a letter sent to the central bank deputy governor, Ahmed Jamal, on June 11. He said that the subscribers of the online streaming sites paid the fees from the country in foreign currency and in most cases, they used personal credit cards to make the payment. According to the VAT and Supplementary Duty Act-2012, subscription to such channels is considered a service which is subject to VAT payment under the service code 099.20. But the revenue board is not able to generate any revenue from the sector, he said. The commercial banks can deduct 15 per cent VAT while making the payment and the payment is completed using credit card, he wrote to the central bank. However, the VAT intelligence was informed that the banks were not deducting the VAT as they had received no such instruction from the Bangladesh Bank in this regard. Under the circumstances, the BB has been requested to give the necessary instructions to the commercial banks for deducting the VAT from the sector. NBR officials said that the revenue board brought the services under the VAT system in the budget for the fiscal year 2019-2020 but the provision remained unimplemented due to lack of monitoring as well as the failure of the banks to deduct the VAT. Some subscribers told New Age that they had begun to receive texts from the banks regarding the applicability of the VAT on payments to the international online services using credit cards.
