Parliament passed the Finance Bill 2023 on Sunday with scrapping the much-talked-about provision for individuals to pay a minimum tax of Tk 2,000 and submit tax returns for getting 43 government services despite having no taxable income.
Besides, the government has backtracked on its decision to impose 15 per cent VAT on ballpoint pens, and slap a specific duty on fuel oil imports in the proposed budget for FY 2023-24 after facing widespread criticism from experts, parents and stakeholders.
Rather it has imposed 5 per cent VAT on ballpoint pens and levied customs duty, advance tax and VAT as earlier on fuel oil imports.
The government also withdrew the provision of mandatory submission of invoice regarding fuel oil imports in a bid to tame inflation and rein in oil prices at the consumers’ end, said finance ministry officials involved with the budget preparation.
Earlier, fuel oil importers had to submit invoice. If imported at higher cost than minimum tariff value, they had to pay duty as per the prices mentioned in invoice. In such case, fuel oil importers will not need to pay additional duty and VAT.
In the proposed budget for FY24, the government imposed 15 per cent VAT on ballpoint pens at manufacturing stage and levied specific duty of Tk 13.75 per litre on 11 types of petroleum products, including kerosene, light diesel, motor spirit and jet fuel, withdrawing VAT, AT and customs duty.
The government also slapped specific duty of Tk 1,117 per barrel (Tk 7.02 per litre) on imports of petroleum oil, bituminous minerals, and crude oil and Tk 9,108 per tonne (Tk 9.10 per litre) on furnace oil imports.
Earlier, the prices of major fuel oils such as furnace oil, jet fuel diesel, and octane included a total of 34 per cent import duties and taxes, with 10 per cent customs duty, 15 per cent VAT, 2 per cent advance income tax, and 5 per cent advance tax.
Meanwhile, 28 per cent import duties and taxes were imposed on crude oil, and 31 per cent on base oil. The duties and taxes are likely to be imposed again.
However, the National Board of Revenue (NBR) collected import revenue by charging duty of $265 per tonne of furnace oil regardless the import price and jet fuel, diesel and octane face a fixed minimum assessment rate of $0.40 per litre.
Besides, the customs authorities assessed the invoice of fuel imports and if the price of fuel is higher than $0.40 per litre, importers had to pay a higher duty as per the price.
According to the Customs House, Chattogram, the latest assessment rate was $270 per tonne of furnace oil, $0.49 of high speed diesel oil, $0.50 of kerosene oil, and $0.55 of motor spirit oil imports.
If the government withdraws the invoice submitting provision when the budget will be passed in the parliament, importers can clear duty only at $265 per tonne of furnace oil and $0.40 per litre of jet fuel, diesel and octane.
Currently, diesel and kerosene are selling for Tk 109 a litre at consumer level while octane and petrol for Tk 130 and Tk 125 respectively.
