Regulatory and supplementary duty on import of 425 types of goods withdrawn

As part of tariff rationalisation, the Ministry of Finance proposed in budget FY2024 to withdraw the existing regulatory duty and supplementary duty on 191 types of apparel and 234 types of fish imports.

These products include imported fish like tilapias, catfish, carp, eels, Alaska pollack, rays and skates, seabass, animal meat and hair, food items, and garments items like T-shirt, fabrics, tie, trousers, suits, jackets, artificial fabrics, underpants, chemicals and cosmetics.

The cost of importing garments items will be reduced somewhat due to the move. At the same time, the cost of importing fish will also decrease.

However, since there is not much revenue collected from these sectors, the relevant sources of the National Board of Revenue (NBR) said that as a result, there will not be much impact on the revenue.

Currently, there is a 3% regulatory duty on apparel imports, and a 20% supplementary duty on fish imports in most cases.

In the next three consecutive budgets, the government will also lift 1,200 to 1,300 types of supplementary duties to reduce trade barriers in import and export between Bangladesh and other nations after the country's graduation.

There are around 7,000 types of tariffs on the import of goods including 1,926 supplementary and regulatory duties.

Supplementary and regulatory duties are mainly imposed on products that are incompatible with the local culture and are luxurious and a sudden withdrawal is not possible, said officials of the NBR.

Instead, tariffs should be dropped on products which are least imported and are least likely to reduce revenue generation and put more pressure on foreign currency reserves, they said. 

Otherwise, Bangladesh will find it difficult to make the graduation and conform with regulations of other developing countries, they added. 

One of the recent International Monetary Fund (IMF) loan conditions is that Bangladesh has to raise the tax-to-GDP ratio by 0.5 percentage points in fiscal year 2023-24, 0.5 percentage points in fiscal year 2024-25, and 0.7 percentage points in fiscal year 2015-26. 

To attain the target, the NBR will have to collect an additional Tk 2.34 lakh crore over the next three fiscal years.