B Mirror Report: The government has reduced Value Added Tax (VAT) on liquefied petroleum gas (LPG) in a move aimed at stabilising the domestic market and keeping the essential fuel affordable for consumers.

In a press release on Monday night, the National Board of Revenue (NBR) announced that two notifications issued on February 16, effective until June 30, 2026, revise the existing VAT structure on LPG.

Previously, a 7.5% VAT was applied at local production and trading stages, while a 2% advance tax was levied on imports. Following an application from the Liquefied Petroleum Gas Operators Association of Bangladesh (LOAB) and a recommendation from the Energy and Mineral Resources Division, the government has withdrawn the 7.5% VAT on local production and trading and the 2% advance tax on imports.

Under the new system, a uniform 7.5% VAT will now be collected only at the import stage. This means no VAT will be charged on value addition during local production and sales after import.

Officials said the decision was made in the public interest, as LPG is vital for both industrial and household use. The measure is expected to help maintain domestic price stability, reducing the overall VAT burden on consumers by around 20% compared to the previous structure.

The revised VAT arrangement will remain in effect until June 30, 2026, unless further amended or extended by the government.