Rolls-Royce, BMW, Mercedes… 40 luxury cars face probe for Tk500cr duty evasion

Bangladesh currently has 10-11 luxury Rolls-Royce cars, with four imported in 2024 through Chattogram Port as electric vehicles, significantly reducing duties from Tk35-40 crore to Tk4 crore.  

The Chattogram Custom House lost at least Tk120 crore in revenue from these four oil-powered Rolls-Royce cars, each evading a minimum of Tk30 crore, according to the Customs Intelligence and Investigation Directorate (CIID)

Along with the four cars, at least 40 luxury cars from various globally renowned brands, including BMW, Mercedes-Benz, Audi, Nissan Safari, and Nissan GTR, have been under the scrutiny of CIID for being imported through fraudulent means since 2015.  Three of the vehicles have already been seized in Dhaka and Chattogram.  

The remaining 36 cars evaded an average duty of Tk10 crore each, totalling Tk360 crore, with customs officials estimating a total revenue loss of around Tk500 crore across all 40 vehicles. 

CIID officials added that information is being gathered on the vehicles.  

Md Minhaj Uddin, additional director general of the CIID, Chattogram, told The Business Standard, "We have requested import information on 40 vehicles released through Chattogram and Mongla ports. These vehicles were cleared by altering their model and series after under-invoicing. Action will be taken against the importers based on the findings."  

According to customs, the maximum duty on car imports is 827%, meaning a car priced at Tk1 crore incurs Tk8.27 crore in duty. Duty rates vary based on engine capacity and whether the car is hybrid or non-hybrid. 

To evade duty, unscrupulous groups alter the model year and declare luxury cars as car parts for clearance.  

On 25 November last year, the CIID seized a luxury Nissan Safari car from a garage in Khulshi, Chattogram, due to missing import documents, with an estimated duty and tax value of Tk10 crore. The 5,600cc vehicle, registered as a Nissan Patrol by the BRTA in 2016, was identified through its chassis number as a higher-quality Nissan Safari.  

Twelve days earlier, the CIID also seized a BMW Seven Series car in Dhaka's Tejgaon Industrial Area, imported under false declarations. 

These two consecutive seizures highlight fraudulent practices in luxury car imports, evading approximately Tk20 crore in duties.  

Md Habib Ullah Dawn, president of the Bangladesh Reconditioned Vehicles Importers and Dealers Association, told TBS, "Some cars were imported into Bangladesh in late 2023 after converting Rolls-Royce brand oil-powered vehicles to electric. If any organisation is found guilty of fraud in clearing these cars, appropriate action should be taken."  

"Furthermore, if any organisation is involved in customs evasion with other luxury cars, the Customs Intelligence and Investigation Directorate should take action."  

Analysts have suggested investigating whether customs officials are involved in these frauds, noting that such incidents are unlikely to occur without their participation. Customs is losing a significant amount of revenue due to these activities.  

Advocate Akhtar Kabir Chowdhury, president of the Conscious Citizens Committee in Chattogram Metropolitan, told TBS, "Corruption is rampant across the country, and customs is no exception."  

"It is impossible to clear luxury cars like this without customs' involvement. Bank defaulters are also implicated in these frauds. In the current situation, it is essential to hold these corrupt individuals accountable under the law."