Covid-19: Noab for withdrawing newsprint import duty

The Newspaper Owners' Association of Bangladesh (Noab) has demanded duty-free import of newsprint as raw materials, noting that the newspaper sector is not getting the same benefits as other industries even though it has been declared an industry.

To save the newspaper industry, it has also proposed withdrawing the advance income tax on advertisements during the Covid-19 pandemic and cut the corporate tax rate from 35% to 15%.

Noab President AK Azad tabled the proposals at a pre-budget discussion organised by the National Board of Revenue (NBR) on Wednesday.

He said duty in the newspaper industry is 30% at present, including 15% VAT, 5% import duty, 5% advance income tax, and advance tax.

But other government-announced industries import raw materials at zero tariff, he said.

Azad said the quality of local paper is not good and newspaper circulations have markedly declined during the pandemic.

"In this situation, it is necessary to withdraw the duty on newsprint considering it a basic raw material of the newspaper industry. Besides, the corporate tax rate in other sectors, including textiles, is below 15%, but it is 35% in the newspaper industry. This should be slashed to 15%."

Former Noab president Mahfuz Anam said newspaper, if considered an industry, should get sympathetic treatment.

"It is also a service industry. Other industries have low tariffs on raw materials but it is 30% in the newspaper industry. The pandemic has severely damaged the industry and assistance is needed now."

Another Noab member Dewan Hanif Mahmud said government organisations deduct VAT when they pay advertisement bills but do not issue invoices, which creates terrible pressure.

"Also, 4% advance income tax is deducted from advertisement bills. This tax should be withdrawn for a year considering the pandemic."

NBR Chairman Abu Hena Md Rahmatul Muneem said the revenue board not only collects revenue but also works to protect local industries.

He said there are several paper mills in the country but he does not know whether they can supply quality paper. "If they cannot and import dependency is created, we will consider that."

Muneem said the country is producing good paper, including that used to make banknotes.

"Despite that, we will see why local paper industries are unable to provide quality newsprint."

Mozammel Babu, president of the association of TV channel owners, said 75% of local advertisements are aired on foreign channels.

"As a result, the organisations involved in this are getting benefits, but the government is losing revenue. This is a big fraud."

He said the government is losing Tk1,720 crore in VAT and around Tk2,000 crore in income tax annually as VAT is not collected properly from cable TV service providers.

Emphasising forming a single authority to properly collect revenue from cable TV operators, the NBR chairman said he would talk to the ministry concerned in this regard.

He hinted at getting cooperation from the associations in this regard, saying, "For now, we will have to discuss. We need to know whether anyone is providing these services, except for the members. For this, some preparations are needed."

Senior NBR officials involved in the budget were present at the discussion.