More cars, more tax
Syed Samiul Basher Anik

If anyone owns more than one vehicle, he/she will have to pay 50% extra tax apart from the tax payable on the vehicle

Owners of motor cars, sport utility vehicles (SUVs) or microbuses have to pay an extra 50% advance income tax (AIT) on renewal of fitness certificates and registration fees if they possess more than one vehicle.

The National Board of Revenue has issued a notification, finalising the new AIT rates on renewal of fitness certificates and registration of the three motor vehicles with the introduction of three new slabs that took effect from July 1.

According to the notification, if anyone owns more than one vehicle mentioned above, he/she will have to pay 50% extra tax apart from the tax payable on the vehicle.

“No matter whether people buy the vehicles on single ownership or jointly with some other persons, they have to pay additional tax,” an NBR high official told the Dhaka Tribune.

Though the board had finalised the new tax structure with a hike on vehicles having higher engine capacity, it has kept the tax rate on vehicles having the capacity from 1500cc to 2000cc unchanged.

The NBR also rationalised the duties imposed on the cars and SUVs by keeping the system of calculating the duties as per the same engine capacity, which was earlier calculated under separate slabs of taxes, officials concerned said.

They said the NBR had decided to raise duties on luxury vehicles as it had calculated that the board could collect a handsome amount of revenue from the sector.

“If people can afford to buy luxury vehicles, they should pay more taxes as they are capable of spending a huge amount of money,” the NBR official added.

The highest slab of AIT was set at Tk1.25 lakh for motor cars and jeeps above 3500cc (cylinder capacity). The other slabs were Tk1 lakh for cars and jeeps having the engine capacity of 3000cc-3500cc and Tk75,000 for cars and jeeps having the capacity of 2500cc- 3000cc.

In the last fiscal year, the board was charging Tk50,000 as the highest slab of AIT on private cars over 2000cc, but people having cars and jeeps from 2000cc-2500cc will now have to pay Tk50,000.

The lowest two slabs for 1500cc and 2000cc vehicles remain unchanged at Tk15,000 and Tk30,000 respectively.

As per the new rule, the AIT
imposed on the microbus was set at Tk20,000, up Tk5,000 from the previous rate.

On behalf of the revenue authority, the Bangladesh Road Transport Authority (BRTA) collects the AIT for registration and renewal of fitness certificates. 

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