• Monday, Dec 09, 2019
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NBR offer tax exemption on imports of sanitary napkins

  • Published at 11:00 pm July 2nd, 2019
The National Board of Revenue (NBR) office in Dhaka Mehedi Hasan
The National Board of Revenue (NBR) office in Dhaka Mehedi Hasan/Dhaka Tribune

Entrepreneurs urge the authorities to reconsider supplementary duties in an effort to promote local firms and attain health targets of SDGs

In the face of strong opposition from the business community and women’s’ rights group, the National Board of Revenue (NBR) has exempted supplementary duty (SD) on raw-material imports of sanitary napkins and diapers to protect the local industries.

On June 30, the VAT wing of the NBR issued a statutory regulatory order (SRO) scraping the supplementary duty (SD) on imports of raw materials for sanitary napkins. It would remain effective for two years up to June 30, 2021.

In order to avail this opportunity, a local manufacturer is required to ensure a minimum 30% value addition and create at least 250 jobs in the factory. 

The decision to exempt the supplementary duty was taken in an effort to give local manufacturers opportunity to expand and meet the demands of local consumption at an affordable price; hence, meet the health targets of Sustainable Development Goals (SDGs).

In the budget for FY2019-20, the government imposed a 45% supplementary duty on import of sanitary pads and tampons; napkins and napkin liners for babies, and similar articles, of any material. 

Defining the products as luxury items, the government imposed the supplementary duties, which drew criticism from women’s rights bodies as further taxes would spark the prices of sanitary napkins and diapers to go up.

Entrepreneurs and manufacturers urged the government to reconsider supplementary duties for the sake of local businesses.  

Terming the government decision to rescind import duties on sanitary pads as extraordinary initiative, the Water Aid Bangladesh said in a statement. 

It is expected that the price of sanitary pads can be lowered by 40% if this exemption is factored in manufacturing sanitary napkins more cost efficient for tens of thousands of women and girls in the country, said Water Aid Bangladesh.

It also urged all sanitary napkin manufacturers to immediately apply this tax-exemption on prices, so that women and girl may get benefitted.

The UK charity hopes the government would continue to support similar initiatives for women, particularly encouraging small and medium size manufacturers across the country to promote accessible and affordable hygiene products for women and girls in rural and hard-to-reach regions of the country. 

According to the industry officials, annual market size of sanitary napkin is about Tk400 crore, which is growing at 20% per year. While, infant diaper market is Tk300 crore and it is growth rate is 15%.