Dhaka, Bangladesh (BBN)– The government has fully waived the value added tax (VAT) on five essential food items to be procured by the state-run Trading Corporation of Bangladesh (TCB), to help rein in their soaring prices in the local market.

The items are edible oils, pulse, onion, sugar, and lentil.

“It’s a time befitting decision, which would go in favour of consumers,” Ghulam Hossain, Commerce Secretary, was quoted by the Financial Express (FE), a local newspaper, as saying.

He also said: “The TCB will undertake efforts soon to procure food items from local markets so that essential items can be sold at cheaper rates following the VAT waiver as a special case.”

VAT exemption will be applicable to procurement of 38,000 tons of soybean and palm oil, an equivalent quantity of sugar, 10,000 tons of lentil, 750 metric tons each of pulse and onion a National Board of Revenue (NBR) order said.

The VAT-waiver facility will remain valid for the next one year, the NBR order added.

The rate of VAT on these items now stands at 6.0 percent.

BBN/SSR/SI-20Oct10-1:20 am (BST)