A surprising reason behind factory fires, high taxes on fire safety equipment

Experts think that one of the reasons for the lack of safety is that entrepreneurs are simply uninterested to invest in fire prevention

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Higher import duty is the sole reason why manufacturers are not outfitting their factories with fire safety equipment, despite calls for its ever-increasing presence in workplaces.

With fire incidents at non-apparel factories on the rise, a recent survey by the Centre for Policy Dialogue (CPD) said that in the past six months, 82 factories experienced fire incidents which claimed 128 lives leaving 283 burnt or injured.

Experts think that one of the reasons for the lack of safety is that entrepreneurs are simply uninterested to invest in fire prevention.

However, business leaders and manufacturers say the import tax structure of fire safety equipment is unfair. 

“The government must ensure equal tariff facilities in every sector like the apparel industry on the import of fire safety equipment,” they said.

They also said that the government only allows the apparel sector to import fire safety equipment at reduced rates.

As workers in all sectors have equal rights to safety and security, there should be no such discrimination in the tariff rate, they suggested.

According to the NBR, the total tax incidence is 58.6% for fire door, fire alarm cable and hose reel imports, 37% in gate valves, 26.2% for fire pump and fire alarm system (detector), 11.05% for fire extinguishers and 31% for ABC dry powder.

Rising need for safety

On July 8 of last year, 52 workers died after a fire broke out at Hashem Foods Factory, also known as Shezan juice factory in Narayanganj’s Rupganj.

Convener of the Nagarik Tadanta Committee (Citizens' Investigation Committee) Barrister Jyotirmoy Barua said that there were no smoke detectors, fire alarms or emergency exits anywhere in the six-storey building.

On November 6 last year, another fire incident at a shoe factory in Old Dhaka took the life of five.

Another fire broke out at a garment factory in Dhaka’s Shyampur on the night of January 15 earlier this year. No one was reported dead at that incident and the source of the fire remained unknown.

However, just after a day on, January 17, three workers of the Bangladesh Steel Re-Rolling Mills (BSRM) factory at Chittagong’s Mirsarai were injured in another fire incident.

In the last six months, the highest number of 29 fire accidents occurred in Dhaka, 10 accidents were happening in Narayanganj, 8 in Gazipur and 8 in Chittagong.

A senior official of Akij Footwear Limited said that it goes without saying that the tariff rate is extremely high.

“Even large factories like ours face many problems, from importing to installing the fire safety equipment. There are many small and medium-sized shoe factories that are unable to import equipment due to high tariff rates,” he added.

What experts say

In a statement, Md Niaz Ali Chisty, chairman of the FBCCI standing committee on fire safety, disaster and explosion, said that it was important for factories in all sectors to have fire protection systems to ensure safe industrialization in the country.

“But other than the apparel industry, other industrialists have to bear the heavy tax burden of importing this much-needed equipment,” he added.

Due to high tax incidence, it is often not possible for small and medium entrepreneurs to take adequate fire protection measures, which is why equal tariff facility was required, Chisty added.

Separate permits, required for the import of carbon dioxide, foam, dry powder and other fire-resistant gasses and chemicals, result in harassment and time delay for the importers.

Talking to Dhaka Tribune, Shaheen Ahamed, president of the Bangladesh Tanners Association (BTA), said that equal tariff facilities are needed for all.

Many medium and small factories are not able to buy fire equipment due to high tariff rates and they have to continue running their factories at high risk, he further mentioned.

Ahamed also said that unlike public perception, the factory owners have the intent to operate their factories in compliance with all the requirements.

Therefore, this policy support is needed from the authorities so that fire safety can also be invested on by the factory owners, he added.

Helal Uddin, president of the Bangladesh Dokan Malik Samity, told Dhaka Tribune that reducing the high tariff rates to a tolerable level would allow every business owner, big or small, to benefit.

After installing it in every shopping mall, training for the operator should also be arranged, he added.

However, a National Board of Revenue (NBR) official, seeking anonymity, told Dhaka Tribune that the benefits the apparent industry owners currently enjoy was for a special reason.

This facility was passed following the Rana Plaza collapse and the Tazreen fire incident. Then the NBR's customs wing issued a statutory regulatory order (SRO) on March 11, 2018 to help them comply with the safety rules and requirements of international buyers, he added.

Meanwhile, in the budget for the next 2022-23 fiscal year, the FBCCI has brought up the issue of equal tariff facilities like RMG for every sector on the import of fire safety equipment, not just garments.

Asked about this, the NBR official said: “Every year before the budget, we discuss VAT issues with various sectors. This time the discussion has already started.”

If such proposals are received from all the sectors there, surely the tax rates can be reconsidered, the NBR official added.

Desk: Wafi


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