Kazi Law Chamber is an established VAT, tax and customs law firm in Dhaka, advising domestic companies, foreign-invested businesses, multinational affiliates, and individual taxpayers on the full range of tax and fiscal regulatory matters arising under Bangladesh law. Our practice spans transactional tax advisory, regulatory compliance structuring, HS Code classification and customs duty optimisation, VAT and income tax dispute representation, customs penalty appeals, and writ proceedings before the High Court Division where the conduct of the National Board of Revenue,Customs Authorities or its subordinate authorities requires judicial challenge.
Book a ConsultationBangladesh's fiscal regulatory environment has undergone significant structural change in recent years. The Income Tax Act 2023 replaced the Income Tax Ordinance 1984 and introduced a substantially rewritten framework for corporate and personal taxation. The VAT and Supplementary Duty Act 2012 and the VAT and SD Rules 2016 govern the VAT regime, which applies at a standard rate of 15% on most supplies of goods and services. The Customs Act 2023 replaced its predecessor legislation and introduced new provisions on advance rulings, valuation methodology, and the Authorised Economic Operator framework. The Bangladesh Single Window system became fully operational in 2025, integrating customs clearance across multiple regulatory agencies through a centralised online platform. These changes have created both new compliance obligations and new strategic opportunities for businesses seeking to manage their tax exposure more effectively.
Kazi Law Chamber regularly advises clients on navigating this environment with precision, drawing on a practice that includes genuinely complex mandates across customs classification, cross-border VAT structuring, income tax assessment disputes, and penalty proceedings before the Customs, Excise and VAT Appellate Tribunal.
Three principal regulatory authorities govern the tax and fiscal compliance environment for businesses operating in Bangladesh. The National Board of Revenue is the central authority for tax administration, responsible for income tax, VAT, customs duties, and supplementary duties, and for the formulation and enforcement of tax policy. The Customs, Excise and VAT Appellate Tribunal, commonly referred to as CEVAT, is the statutory appellate body for customs and VAT disputes that have passed through first-level Commissioner of Appeals review or, in certain cases, are directly appealable to the Tribunal. The High Court Division of the Supreme Court of Bangladesh exercises supervisory jurisdiction over the tax authorities through its writ jurisdiction, and provides the avenue for challenging assessment orders, penalty determinations, and regulatory decisions that are unlawful on their face or procedurally flawed.
Understanding which forum applies to a given dispute, at what stage, and under what procedural conditions, is a prerequisite to effective tax dispute strategy. Many tax disputes in Bangladesh are lost not on their merits but because the applicable procedural route was incorrectly identified or inadequately prepared. Kazi Law Chamber advises clients on forum selection, pre-deposit requirements, appeal filing timelines, and the strategic sequencing of proceedings from initial assessment through to judicial review.
Customs duty compliance in Bangladesh is governed by the Customs Act, 2023, the First Schedule of the Customs Tariff, and a range of supplementary notifications and statutory regulatory orders issued by the National Board of Revenue. The total import duty burden on a given product depends on the combination of customs duty, VAT, supplementary duty, regulatory duty, advance income tax, and advance trade VAT applicable at the point of import, all of which are determined in part by the HS Code under which the product is classified. Incorrect or suboptimal HS Code classification can result in sustained overpayment of duties, regulatory exposure for under-declaration, or both.
HS Code classification disputes are among the most technically demanding customs matters in Bangladesh, particularly for technology products, specialised equipment, and goods that fall across multiple product categories under the Harmonised System. The Customs Act, 2023 provides a mechanism for advance rulings from the National Board of Revenue, allowing importers to obtain prospective classification certainty before shipment rather than litigating the correct classification after customs authorities have already made a determination.
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Customs penalty proceedings in Bangladesh arise from a range of regulatory triggers, including misdeclaration of goods, undervaluation, classification disputes, documentation deficiencies, and breach of conditions attaching to duty exemptions or bonded warehouse licences. Penalty orders are issued by the relevant Commissioner and are subject to appeal before the Commissioner of Appeals and thereafter to CEVAT, with certain orders appealable directly to CEVAT without the intermediate Commissioner of Appeals stage depending on the nature and level of the order.
Defending customs penalty proceedings effectively requires both a sound understanding of the substantive customs law and a technically precise approach to the procedural requirements of the appellate system. Pre-deposit requirements, filing deadlines, and the documentary record before the authority at the time of the original order all bear on the strength of an appeal and the available grounds of challenge.
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The VAT and Supplementary Duty Act, 2012 imposes a standard rate of 15% VAT on most taxable supplies of goods and services in Bangladesh. Businesses registered for VAT are required to file monthly returns in Form Mushak 9.1, maintain VAT accounts and issue VAT invoices in the prescribed format, and deduct VAT at source on applicable payments under the VDS mechanism. VAT disputes frequently arise from disagreements over input tax rebate eligibility, output tax calculation, VAT deducted at source and its credit against output liability, supplementary duty classification, and the application of VAT to cross-border service arrangements under the reverse charge mechanism.
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Transfer pricing risk arises wherever a business in Bangladesh engages in transactions with related parties in other jurisdictions, including intra-group service arrangements, royalty payments, management fee charges, intercompany loans, and the purchase or sale of goods between connected entities. Where the NBR takes the view that the pricing of such transactions does not reflect arm's length terms, it may reassess the taxable income of the Bangladesh entity upward, generating a tax liability significantly in excess of what was anticipated. Transfer pricing reassessment risk is heightened in cross-border arrangements involving technology, intellectual property licensing, and centralised service functions.
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Companies remitting funds outside Bangladesh, whether as dividends, royalties, technical fees, service fees, or loan repayments, must navigate a combined framework of income tax withholding obligations, foreign exchange controls administered by Bangladesh Bank, and any applicable double taxation treaty provisions. Structuring these remittances incorrectly creates withholding tax exposure, potential gross VAT liability on services received from non-residents, and the risk of regulatory challenge to the remittance itself.
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The statutory framework for tax and customs disputes in Bangladesh now provides for ADR as an alternative to continued litigation before the appellate tribunals and courts. ADR proceedings are conducted through facilitators, typically retired government officials, lawyers, or chartered accountants, and can result in a binding settlement that resolves the dispute at a fraction of the cost and time of full appellate litigation. ADR is available at specific stages of the dispute process and requires careful assessment of whether a proposed settlement represents a commercially rational outcome compared to the likely result of continued proceedings.
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Corporate income tax compliance in Bangladesh involves a range of ongoing obligations under the Income Tax Act, 2023, including the filing of annual returns, advance tax payments, withholding tax deductions and deposits on applicable payments, maintenance of accounts in a form acceptable to the tax authority, and participation in assessment proceedings initiated by the Deputy Commissioner of Taxes. Where an assessment is disputed, the matter proceeds through the Commissioner of Taxes (Appeals) and then to the Taxes Appellate Tribunal, with a High Court reference available on questions of law.
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Kazi Law Chamber's tax and customs practice is grounded in substantive transactional and dispute work rather than routine compliance processing. Our lawyers have advised on complex HS Code classification matters involving proprietary technology products, structured multi-scenario tax analyses across alternative business models for foreign-invested companies, managed customs penalty appeals before CEVAT, and identified and advised on the transfer pricing, VAT, and withholding tax dimensions of cross-border service arrangements involving parent companies in Japan, Finland, and other jurisdictions. We understand that tax advice at the level businesses require is not simply about stating what the law says. It is about identifying where the risks sit, what the available options are, and how to structure a position that is both commercially sound and defensible before the relevant authority.
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