Tax on import of HR coil, zinc likely to drop

Finance Minister AHM Mustafa Kamal has proposed to reduce the tax rate on import of HR coil and zinc, raw materials, used for manufacturing galvanized iron sheet or steel products, from 5 per cent to 3 per cent for the FY2022-23.

The minister proposed it before the national parliament on Thursday during placing the budget of the Tk6, 78,064 crore.

The budget was titled ‘Return to the Path of Development Leaving the Covid-19 Behind’.

Galvanised iron sheet or steel products are one of the major components of building physical infrastructure and implementing the Ashrayan project of the government.

Providing tax benefit to the industries engaged in manufacturing such products will make building physical infrastructure and implementing the project easier and more cost-effective, Kamal said.

Speaking on the steel industry, the minister also proposed to increase the existing import duty on both the products from 5 percent to 10 percent in order to encourage the production of import substitute products in the electrode manufacturing and wire drawing industry.

“There are 15 percent and 25 percent import duties on different types of pipes. As it is a homogeneous product, it is time consuming and difficult to ascertain the exact type of pipe at the time of assessment. Therefore, for the interest of revenue protection, it has been proposed to fix 25 per cent import duty on such products,” Kamal added.

Galvanized Iron (GI) fittings manufacturing industry has now developed in the country. Therefore, it has been proposed to impose 20 per cent supplementary duty on imported GI fittings to ensure protection of domestic industry.

It has been proposed to impose 20 percent supplementary duty on screws, nuts and bolts etc. for uniformity of total tax incidence for different types of threaded articles as well as protection of local industry.

“At present some local industries are producing high-quality stainless-steel products. In order to encourage the establishment of local backward linkage heavy industry and to ensure market competitiveness of the product I am proposing to reduce the existing import duty from 10 per cent to 5 per cent on Hot-Rolled Stainless-Steel sheet as raw material,” the minister said.

However, wires, rods, tubes, plates, electrodes and similar products are subject to different import duty rates. In order to harmonize the duty rates on such products, it has been proposed to increase the existing import duty on such products from 10 per cent to 15 per cent, he also added.