Restaurant owners demand tax relief

The Bangladesh Restaurant Owners’ Association (BROA) has called on the government to keep VAT and tax rates at a reasonable level in the upcoming national budget while also expanding the tax net to ensure wider compliance.

Although VAT on restaurants was reduced from 15 percent to 5 percent, businesses are still under pressure due to supplementary duties, source tax and other charges, said Imran Hassan, secretary general of BROA, at a press conference held at Dhaka Reporters Unity yesterday.

He demanded the withdrawal of the source tax and proposed a fixed 5 percent VAT for canteen and catering services.

Imran also warned that around 80 percent of restaurants in the country remain unregistered, with many allegedly bypassing health and tax regulations while offering cheaper food. According to him, this situation poses risks to both public health and the formal restaurant sector.

He urged authorities to bring all restaurants under the tax system, cautioning that compliant businesses may be discouraged from paying taxes if the imbalance continues.

On the energy situation, Imran identified LPG shortages as a major challenge disrupting restaurant operations and pushing up food prices. He called for increased LPG imports, improved supply management and stronger market monitoring. He also urged the resumption of new pipeline gas connections for restaurants and the introduction of LPG cards for business owners.

He further said that complex licensing procedures and weak coordination among government agencies are making food safety enforcement difficult. He noted that opening a restaurant currently requires around 10 to 12 different certificates, a process that can take two to six months and significantly increase costs.

He proposed a “one-stop service” to simplify licensing, reduce delays and cut expenses, alongside stronger food safety monitoring.

Imran also criticised what he described as harassment during regulatory inspections, suggesting that representatives from the business community should be included in inspection teams. He called for simple digital systems for licensing and renewals, an end to unfair fines and more business-friendly policies to support investment and job creation.

He warned that the rapid expansion of large corporations is putting pressure on small and medium enterprises and weakening fair competition. He urged the government to introduce policies to prevent monopolies and ensure equal opportunities across the sector.

Reiterating long-standing demands, Imran called for the implementation of the government’s 2022 decision to recognise the restaurant sector as an industry, saying it should receive bank loans, tax benefits, incentives and SME policy support.

He also demanded an end to extortion and harassment linked to trade unions, stressing the need for a stable, safe and corruption-free business environment.

The association additionally called for permission to import beef and proposed government-led training programmes for unskilled workers. It said structured training in food safety, hygiene, customer service and modern restaurant management could improve skills and help facilitate overseas employment for up to one million trained workers over the next five years.