The National Board of Revenue (NBR) has ordered businesses to submit VAT returns for July, August, and September by October 15 this month. No penalty will be imposed if returns are submitted within this period. Earlier, the government had introduced a provision for filing VAT returns every three months starting from the current fiscal year. However, this new directive comes amid an initiative to move away from that decision and reintroduce monthly return filing.

In an order issued on Thursday (October 1), the NBR stated that, under the national budget for 2026-27, since there was an opportunity to submit returns after the completion of three tax periods, many establishments did not file their July and August VAT returns through the e-VAT system. For these establishments, the deadline for submitting returns has been extended to October 15.

The order further stated that establishments that have not yet submitted their July and August returns must file them within the specified time. At the same time, the September return must also be submitted by October 15. No penalty will be imposed in this regard.

Earlier, for the convenience of businesses, a provision was introduced from the current fiscal year allowing VAT returns to be filed every three months instead of monthly. However, this made it difficult to obtain an accurate month-by-month picture of VAT collection. NBR officials had also been saying that VAT collection was on a negative trend during this period.

In this situation, the NBR took an initiative to reintroduce monthly VAT returns under the earlier rule. At a cabinet meeting held last Monday at the Secretariat, chaired by Prime Minister Tarique Rahman, policy and final approval was given to the draft ordinance in this regard.

The draft of the amended Value Added Tax and Supplementary Duty Ordinance states that, currently, 15 days are allowed for submitting returns after the completion of three tax periods, or three months. Once the new provision takes effect, VAT returns will have to be submitted within 15 days following the end of each monthly tax period.

Meanwhile, nearly three months into the new fiscal year, the NBR has not yet published revenue collection data for any month. Some officials at the organization believe that the change in VAT return filing rules under the budget is causing the delay in publishing revenue collection data.

According to them, the largest share of revenue comes from the VAT department. Because the obligation to file monthly returns was removed, VAT collection data for July and August was not available on time. Whether revenue collection has declined or remains at a satisfactory level will become clearer next month after the returns are submitted.