Businesses seeking to pay value added tax (VAT) of Tk 50 lakh or above will have to use electronic modes from January 1 next year, said the National Board of Revenue (NBR) yesterday.

The revenue authority said it can be done through either e-payment of the VAT wing or an automated challan system termed A-challan, introduced by the Finance Division earlier.

"Businesses will be able to pay VAT through e-payment or A-challan easily and without hassle," said Md Masud Sadiq, member VAT policy of the NBR, in an order.

The move comes at a time when the customs wing of the NBR made use of electronic payment gateways mandatory for payments of over Tk 2 lakh of customs tariffs and taxes from July 1, 2021.

From January 1, businesses will be required to electronically pay any amount of duty and taxes for overseas trade, said an official of the NBR.

The VAT department is also in the process of automating a number of VAT systems.

"We will gradually bring all payments of VAT under electronic systems," said a senior official of the NBR.

Snehasish Barua, partner of the Snehasish Mahmud & Co, hailed the move.

Time to make payments will reduce in line with the increase in process automation, he said.

This will cut the cost of doing business, he added.