The government is restoring monthly VAT return filing, reversing the quarterly system introduced under the Finance Act 2026.
The Internal Resources Division has drafted the Value Added Tax and Supplementary Duty (Amendment) Ordinance 2026 to amend Section 64 of the Value Added Tax and Supplementary Duty Act 2012.
The Cabinet on Monday approved the draft, subject to vetting by the Legislative and Parliamentary Affairs Division.
Under the proposed amendment, businesses will again have to submit VAT returns within 15 days after the end of each tax period, instead of once every three tax periods.
The “tax period” means a month for businesses.
If the 15th day falls on a public holiday, returns can be submitted on the following working day.
Government, semi-government and autonomous bodies, banks, insurance companies and entities filing zero returns will have up to 20 days to submit their returns.
The government said the change aims to increase the pace of revenue collection.
Tax expert Snehasish Barua, director of SMAC Advisory, said the shift to quarterly filing had reduced working capital pressure on businesses.
“Reversing this decades-old practice within barely three months shows a lack of regulatory impact assessment, as it directly affects revenue collection,” he told TIMES.
He said repeated changes in compliance rules force businesses to overhaul systems and weaken investor confidence.
“Policy predictability is the foundation of economic trust. Major fiscal changes require proper assessment before implementation, not sudden reversals,” he added.
