Bangladesh slashes imports duties

Dhaka, Bangladesh | July 01, 2007 by D-8 Secretariat

Bangladesh has reduced import duties on a wide range of products in its 2007/08 (July-June) budget, at a cost of more than 4.0 billion taka, officials said on Saturday.

The 871.37 billion taka ($12.6 billion) national budget effective from July 1, focused on poverty reduction through boosting revenue, tame inflation and creating more jobs.

Finance adviser to the interim government Mirza Azizul Islam, defending the duty changes, told a news conference they would help local industry to grow and become competitive in international markets.

The state-run National Board of Revenue reduced import duty on export-oriented pharmaceutical and textile machinery and computers and accessories to 5 per cent from 10 per cent proposed in the budget.

The tax authority also withdrew a 10 per cent duty on pulp, a raw material of paper.

In the budget unveiled on June 7, the government set an additional revenue earnings of about 5.0 billion taka through readjustment of the duty structure.

According to Abdur Razzaque, a commissioner of the revenue board, the government has reduced duties on many products after receiving suggestions from different business associations.

Import duty on telecommunication equipment and capital machinery will now be 10 per cent from 15 per cent, duty on mobile and fixed telephone sets is reduced by 20 per cent and a 20 per cent supplementary duty on air conditioner also slashed.

So far this decision has been warmly welcomed by the market, eventhough a complete withdrawal of duty from the export oriented industry is still very much desirable to make Bangladesh manufacturers more competitive in the global market, as told by Mohammad Fazlul Hoque, the president of Bangladesh Knitwear Manufacturers and Exporters Association.

Bangladesh's exports have been led by garments, especially knitwear, since global export quotas were phased out at the end of 2004.

Exports reached a record $10.53 billion in the last fiscal year, of which $7.9 billion came from garments. The new budget envisaged revenue receipts of 573 billion taka, or 10.8 per cent of GDP.

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