Bangladesh has expedited its measures to save its foreign exchange (forex) reserves with two more fiscal interventions, which include increase in regulatory duty (RD) on over 200 import items and relaxing remittance rules.
Officials said that the National Board of Revenue (NBR) will slap additional regulatory taxes to discourage import of this large slew of commodities.
The customs wing made the move attuned to government austerity measures aimed at keeping the country's forex reserves stable in the wake of a global financial and commodity-supply-chain crises, as well as continuing depreciation of the Taka against the US dollar.
Fresh flowers and fruits, cosmetics, and home appliances might be on the prohibitive list of products, sources said.
The customs policy wing of the NBR has finalized the list of products and sent it to the Ministry of Law and Parliamentary Affairs for vetting.
A statutory regulatory order (SRO) could be issued later, making the newly imposed taxes effective until June 30, 2022, sources also said.
Currently, the highest rate is 35%.
Import products that are subject to 25% Customs Duty (CD) are automatically also bound to pay at least 3% RD under the customs act.
A total of 3,408 products are subject to payment of RD in import stages, according to customs tariff lines.
Officials say already there are high duties on the items categorized as non-essential and luxury items.
"Now, considering the current situation, the government would revise it upward following instructions from government high-ups," says one official.
Recently, Sri Lanka became an international debt defaulter with reserves plummeting to naught, while Pakistan imposed a complete ban on the import of more than three dozen non-essential luxury items as part of an emergency economic plan to stabilize the economy.
A senior official of the NBR said that Bangladesh is not in a vulnerable state now to ban import of products like automobiles, mobile phones.
Rather, imposition of additional taxes would bring some revenue and discourage import of those products automatically, he noted.
As per estimation of the NBR, the upward revision of RD would generate an additional amount of Tk1,000 crore in taxes from imports of those products.
