MIZAN RAHMAN

A retrograde step
WE are both surprised and baffled at the finance minister's, or shall we say, the government's change of heart by the turn of a single year! Only in the last year's budget the finance minister had announced that private universities would be exempted from VAT in keeping with the government's goal for stimulating higher education in private sector. But there was a compulsion, too: the public universities do not simply have the capacity to accommodate burgeoning surges in the number of higher education seekers.
That was all very well; but what has changed the rationale now for the evidently ill-advised move by him to announce a sudden withdrawal of private universities from the VAT exemption list?
We believe, however, that the fact that the government is thinking of imposing VAT on private universities stems from an inadequate appreciation of what the private universities have been doing to the cause of higher education. For any number of reasons, the principal one being the much-delayed prospect of graduation from public universities contrasted with timely turnouts from private universities and the resultant connectivity to job market and still higher educational pursuits abroad, students feel constrained to go to private universities. Most important, the graduates and post-graduates from private universities are increasingly manning various professions in the private sector.
Most of the understanding about private universities veers in two extremes: either they are high-charging institutions catering to elitist demand for education, or they are highly commercialised organisations indulging in skimming profits at the expense of offering poor quality degrees. There is a populist, notional and subjective ring to it without the objectivity of accepting the existence of some front-ranking private universities within the country that have set certain standard of higher education.
In this class belong private universities that are non-profiting but tax-paying institutions so that to be imposing VAT on them will amount to passing the burden of higher expenses on to the guardians and students. For all we know, the board members of universities are not salaried. Also, it is being observed that sensitive private universities in deference to public criticism over exorbitant fees are trying to keep them within reasonable range. They also provide stipends to students of limited means. In order to implement their forward-looking programmes they have already made a plea for a tax waiver.
The government has every right to standardise the private universities, to audit their funds and performance in order to ensure that their claim as centres of excellence is well-founded. There cannot be any dispute on it.
What is more, we are saving a valuable quantum of foreign exchange that used to be spent in undergraduate studies abroad but which is now available inside the country at a reasonable cost.
One final point. The imposition of VAT on private universities is patently inconsistent with the government's declared prioritisation of higher education, human resource development, digitisation and private sector-led growth.