Bangladesh reconditioned vehicle importers want a special duty facility on import of hybrid cars in the next fiscal year’s budget.
They have urged the government to provide the special facility by fixing a separate HS code for the imported cars. They said the facility will help the buyers avail more eco-friendly vehicles.
The importers urged the government to deduct 35% of reconditioned hybrid car price shown on the yellow book, at the time of valuation at ports.
Bangladesh Reconditioned Vehicles Importers and Dealers Association (Barvida) placed a set of demands for the upcoming budget to the National Board of Revenue.
The demands were placed through the Federation of Bangladesh Chambers of Commerce and Industry recently.
The NBR will hold a pre-budget meeting with the sector representatives this week to discuss the issues and to hear the logic for special duty benefits on hybrid car import.
Currently, there is no special duty treatment for used, reconditioned, or old hybrid car imports although these cars are more environment-friendly.
Despite the fact that hybrid cars are eco-friendly and fuel-efficient, importers are not importing these cars due to high duty rate, said Barvida President Habibullah Dawn.
He said that consumers have to pay about 25% higher price for availing a hybrid car if compared with the same model of reconditioned vehicles.
As an alternative proposal, Barvida has called upon the government to fix separate duty slabs for hybrid cars by fixing a separate HS code and put such cars in the lowest slab of supplementary duty.
The association also stressed the need for re-fixing a year-wise depreciation rate for reconditioned car import from the next fiscal year as there is no depreciation facility now for the reconditioned cars which are less than six months old.
Barvida suggested the NBR to fix depreciation facilities at 20% for a-year old reconditioned cars, 30% for two-year old, 40% for three-year old, 45% for four-year old and 50% for five-year old cars.
“We have been urging the government for four years for issuing a statutory regulatory order (SRO), on hybrid cars import,” Dawn said.
He said finance minister also gave permission three times, “but we don’t know why the decision always gets stuck at the NBR.”
Bangladesh imports most of the cars from Japan, where 70% of the cars are hybrid, said Dawn, adding that, “if the facilities regarding hybrid cars import are provided in next budget, it will be a suicidal decision.”
Barvida in its proposal demanded for a restructure of a slab to bring the cars with 2001cc to 3000cc under the duty structure.
“Once it is allowed, it will reduce pressures on the import of 1500 cc cars and thus the supply will increase as per demand and price of cars will also go down,” said the Barvida proposal.
The association also requested the tax authorities to completely withdraw supplementary duty on import of microbus with carrying capacity of 12-15 passengers. Currently, there is 30% SD on microbus import.