(1) Notwithstanding anything contained in this Act, supply of any imported service shall be taxable supply, if-

(a) the recipient is a person registered or eligible to be registered person and acquires the service in the process of his economic activity; and

¹[ (b) the supply would have been made in Bangladesh in the process of economic activity by a registered or registrable person, and the service would have been taxable at any rate other than zero-rated. ]

(2) Value Added Tax payable by the recipient of a taxable supply of imported services shall be both output tax and input tax of that person.

(3) If an adjustment event has occurred, or occurs, in consequence of the supply of imported service, such service shall be a taxable supply because of such adjustment event and the recipient of
supply of such service shall be deemed to be the supplier of service.

(4) For the purposes of the definition of “imported services”, and of the application of this Act in relation to such services, if a person, registered or eligible to be registered, carries on economic activity from a specified place in Bangladesh and from one or more specified places outside Bangladesh, then-

(a) such person shall be treated as two separate persons in respect of carrying on taxable activities in and outside of Bangladesh;

(b) the person outside Bangladesh shall be deemed to have made to the person inside Bangladesh (as defined for the purposes of this Act) containing some benefits of the nature of services which is received by the person situated outside Bangladesh through or as a result of the activities carried on by the person situated outside Bangladesh;

(c) the time of the supply shall be determined on the assumption that a supply has been supplied; and

(d) the value of the service shall be determined on the assumption that the service has been supplied by a non-resident situated outside Bangladesh.

²[(5) Notwithstanding anything contained contrary to any other sub-sections, any service imported by a person who is not registered or enlist or is not required to be registered or enlisted, other than the exempt services specified in the in the First Schedule, shall be liable taxable supply and value added tax shall be collected therefrom as follows, namely:-

(a) in case of import of the concerned services, the entire value added tax payable at the time of payment of value partly or fully of the services shall be deducted by the bank or any other financial institution used as means of payment of the value; and

(b) the deducting bank or any other financial institution shall deposit the VAT to the government treasury through Treasury Challan on behalf of the importer of the service and show in his return. ]