Smartphone traders have demanded a cut in proposed customs duty to 10% from existing 25%, saying that goals of Digital Bangladesh by 2021 will not be achieved otherwise.
Bangladesh Mobile Business Association (BMBA) placed the demand from a press conference at National Press Club on Wednesday.
Apart from 25% customs duty, the importers currently pay 15% value added tax (VAT), 2% advance income tax (AIT) and 2% SCM — 30.75% in total.
The draft budget proposed total 57.31% tax for the smartphone imports for the next fiscal, while it newly includes 3% regulatory duty and 5% advance trade VAT (ATV).
BMBA President Nizam Uddin Jitu said smartphone was the key instrument of Digital Bangladesh.
“Tax increase will be a big impediment to achieving the goal,” he said, adding that the move would also cause the government a huge loss of revenue.
On the other hand, if the government would consider the customs duty, the users of smartphone would increase rapidly, which he said would boost digital services including digital financial transaction, e-learning, e-commerce etc.
BMBA General Secretary Md Habibur Rahman and Vice-President Hossain Haider Hiru also spoke in the program among others.
The proposed duty increase was aimed to favour the local assemblers who produced only 3-5% smartphones, they claimed, expressing concern that it would ultimately hit the consumers.
They said they were also in favour of smartphone production locally, but it would need at least two more years.
Moreover, the duty increase would cause a loss of at least Tk2,000 crore to the government annually, they feared, adding that it would hamper the government e-services also.