The government has proposed adding new products to the tariff list and hiking existing duty on many products as part of its multifaceted initiative to tackle the ongoing USD crisis by discoursing imports.
Finance Minister AHM Mustafa Kamal had made the recommendation while placing the proposed national budget for FY24 in the Jatiya Sangsad last Thursday. The National Board of Revenue (NBR) has also issued orders in this regard.
Prices of different products may rise due to the additional duty on imports. The government is currently facing challenges on various economic fronts, including foreign exchange reserves, export trade, and revenue collection on imports.
After Bangladesh graduates from the least developed country bracket, it will be forced to withdraw import duties to take advantage of the bilateral and multilateral free trade agreements with different countries.
Under such circumstances, the government has imposed new tariffs and in some cases hiked them to deal with the current crisis and to protect the domestic industry.
While placing the budget, the finance minister had proposed appropriate customs duty on products used as raw materials by domestic industries to protect their interests.
He also recommended imposing new duties and hiking existing ones on many products such as adhesive and glue, tobacco, and cigarette paper.
In the proposed budget for FY24, a total of 14 products have been brought under the purview of the new import duty, which already came into effect from June 1. Among those, 12 products have been levied a 10 per cent duty and two products 25 per cent duty.
These materials, used in the amusement park and tourism industries, includes cable car ride, dragon fly midi, aqua tower, aqua tube, bumper boats, acrobatic flight, bumper cars, bungee, cricket bowling machine ride, dancing fly mini, dark ride, family slide.
On the other hand, a 25 per cent customs duty (CD) has been proposed on up to 2.5 kg wrapped/canned fresh dates, and other types of fresh dates. Besides, the import duty on 21 products has been increased from 4 per cent to 20 per cent in the next budget.
The products are – cashew nuts (shelled or other), non-printed cast polypropylene film and other, natural or artificial abrasive powder or grain, on a base of textile material, natural or artificial abrasive powder or grain, on a base of paper, of paperboard natural or artificial abrasive powder or grain, on a base of other materials, lifts and skip hoists, escalators and moving walkways, electric motor parts with winding wire, database, operating systems, development tools, security software used for only data or information protection, word processing, spreadsheet, internet collaboration and presentation tools, electric panel, electric cigarettes and similar personal electric vaporising devices, insulated or reefer container, other container, free-wheel sprocket-wheels of bicycle, other, parts, sandwich panel with or without cold room facility.
Specific duty has been increased on two products – cement clinkers imported by industrial IRC holder VAT compliant manufacturers of cement and cement clinkers imported by others.
The regulatory duty has been increased from 12 per cent to 17 per cent.
These products includes, soap, organic surface-active products and preparations for use as soap, in the form of bars, cakes, moulded pieces or shapes, whether or not containing soap; organic surface-active products and preparations for washing the skin, in the form of liquid or cream and put up for retail sale, whether or not containing soap, paper, wadding, felt and nonwovens, impregnated, coated or covered with soap or detergent, elastic/construction glue imported by industrial IRC holder VAT compliant hygienic products manufacturing industry and other.
Supplementary duty has been imposed and increased from 20 per cent to 150 per cent on some products.
The products include, fruits, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, products containing tobacco, reconstituted tobacco, nicotine, or tobacco or nicotine substitutes, intended for inhalation without combustion, other nicotine containing products intended for the intake of nicotine into the human body, cigarette paper imported by others, microwave ovens, parts of electronic cigarettes and similar personal electric vaporising devices.
Meanwhile, a new 15 per cent VAT has been imposed on the imports of shelled and other cashew nuts, fresh dates, dried dates, non-fortified Basmati rice, master batch not containing pigments, escalators and moving walkways, stator with winding wire, database, operating systems, development tools, security software used for only data or information protection, word processing, spreadsheet, internet collaboration and presentation tools, electric panel, Sandwich panel with or without cold room facility.
Customs duty has been increased from 1 per cent to 15 per cent by withdrawing tax rebates in some products, which includes escalators and moving walkways, electric panel, sandwich panel with or without cold room facility.
The government has addressed the issue of imposing additional customs duty on products in the budget.
To deal with the crisis, in May last year, 15 days before the budget, it imposed regulatory duties on 135 products in a bid to save one billion dollars. Officials concerned claimed the plan has been successful.
At a post-budget press conference, Bangladesh Bank Governor Abdur Rouf Talukder said the government is emphasising on reducing the demand for imports.
“We have already taken various steps in principle to discourage imports in order to increase the reserve,” he said, adding that currently, there is a balanced current account balance and a negative financial account.