Finance Minister AHM Mustafa Kamal on Thursday proposed to impose value added tax (VAT) and additional tariffs on a number of products to raise the tax-GDP ratio.
He proposed imposing 15% VAT on ballpoint pens at the manufacturing stage and 5% VAT on software production and customization services.
Kamal proposed a 5% VAT at the local manufacturing stage on polypropylene staple fibre and continued the existing exemption on imports of basic raw materials until June 30, 2024.
He also proposed raising 7.5% VAT from the existing 5% on locally manufactured iron or steel (LPG cylinders).
The finance minister also proposed to extend the notification period till June 30, 2024, for mobile phone manufacturers and assemblers by imposing 2% instead of 0%, 5% instead of 3% and 7.5% instead of 5% respectively, at the local stage.
A 7.5% VAT instead of 5% on aluminum and kitchen or other household articles, sanitary ware, all types of plastic tableware, kitchenware, household articles, hygiene, and toilet articles, including any similar products except for tiffin boxes and water bottles, and sunglasses has also been proposed.
The finance minister also proposed 7.5% VAT instead of 5% on kitchen towels (24-26 gsm), toilet tissue (18-24 gsm), napkin tissue (20-24 gsm), facial tissue/pocket tissue (12-16 gsm), hand towels, paper towels, or clinical beds.
He proposed raising the existing exemption limit for handmade biscuits to Tk200 per kg from Tk150 and for cakes (excluding party cakes) to Tk300 per kg from Tk250 to reduce the existing 15% tax rate to 7.5%.
He also proposed to increase the Total Tax Incidence (TTI) on the import of shelled cashew nuts from 15.25% to 43% and also proposed to levy 15% VAT at the import stage on non-fortified Basmati rice and impose a 20% supplementary duty on the import of processed nuts and processed fruits.
To encourage the expansion of heavy industries in the country, the finance minister proposed increasing the existing customs duty to 15% on lifts and skip hoists.
To protect the domestic software industry and to prevent false declarations and duty evasion, he proposed to impose 25% customs duty and 15% VAT on the import of software and also increase the customs duty from 1% to 10% on electric panels.
He also proposed to increase the customs duty from 10% to 15% on the import of freewheel sprocket wheels for bicycles.
The finance minister also proposed raising sandwich panels' customs duty from 1% to 5%.
He also proposed increasing the customs duty on goggles and parts from 5% to 25%.
The finance minister also proposed imposing a regulatory duty of 20% on the import of face wash.
