LPG is exempt from VAT during the production stage

The government has waived the 7.5% additional value-added tax (VAT) on the production of liquefied petroleum gas (LP Gas). 

According to a UNB report, the National Board of Revenue (NBR) issued a special order on Monday regarding this exemption. The NBR highlighted that LP Gas is widely used as cooking fuel in households, as fuel for vehicles at autogas stations, and as a power source in various industrial establishments. Given the growing demand for LP Gas, driven by the insufficient supply of natural gas from distribution companies, its use is expanding in industrial sectors, including garment factories.

To facilitate the production and accessibility of LP Gas, the NBR has decided to exempt it from the additional 7.5% VAT at the production stage. The exemption will take effect retroactively from January 9, 2025.