Tour operators demand retaining VAT exemption

The Tour Operators Association of Bangladesh (TOAB) yesterday demanded scrapping a recent budgetary proposal for withdrawing a value added tax (VAT) exemption on services of tour operators for the development of the industry.

Tour operators use elements from various sectors to create travel packages which are convenient and comfortable for tourists, said TOAB President Md Rafeuzzaman at a press conference in Dhaka Reporters Unity.

If VAT is imposed on the elements that make up services of tour operators, the prices of travel packages alongside travel costs will increase significantly, he said.

As a result, the entire tourism industry, especially inbound and domestic tourism, will be severely affected, he said.

"VAT is already payable when renting a hotel room, purchasing a ticket for transportation, tourist attractions or amusement parks and paying a bill for restaurant meals," he said.

"So, imposition of VAT on services of tour operators is not logical," said Rafeuzzaman.

According to him, the tourism industry is vast, encompassing multiple sectors, and can both earn and retain hard-earned foreign exchange through tour operators.

Withdrawal of the existing VAT exemption may hinder the development of the industry, he said.