In a bid to curb the rising prices of daily essentials ahead of Ramadan, the government has decided to reduce duties on four essentials – rice, oil, sugar and dates.
The National Board of Revenue (NBR) issued separate notifications on Thursday, announcing the reduction in Value-Added Tax (VAT), which will come into effect immediately.
This decision follows the request made by the Ministry of Commerce to the NBR to lower customs duties on these essential products.
In response to this decision, State Minister for Commerce Ahsanul Islam Titu said that the government has slashed duties on essentials to bolster supply and mitigate the price situation during the upcoming holy month of Ramadan, set to begin in the middle of March.
Speaking to journalists at his office on Thursday, the state minister said: "We will promptly convene a meeting with importers and manufacturers to determine prices in light of the new duty structure. Traders will be obliged to sell products at the established prices."
Following her government’s re-election for a fourth consecutive term in January, Prime Minister Sheikh Hasina urged the newly appointed ministers to take necessary measures to stabilize essential prices during Ramadan.
On January 18, Bangladesh Bank streamlined policies for banks regarding cash advances from importers when opening letters of credit (LCs) for the import of essential commodities.
Rice
According to the NBR notification, the import duty on both parboiled and uncooked rice has been completely waived.
Additionally, the regulatory duty on parboiled rice imports has been decreased from 25% to 5%.
Importers of rice can avail of these benefits until May 15.
However, each shipment of imports requires written approval from an official of the rank of joint secretary of the Ministry of Food to qualify for these benefits.
Oil
For oil, VAT has been entirely eliminated at the production and business levels for refined soybean and palm oil within the country.
This means that companies and traders involved in this sector will be exempt from paying VAT temporarily.
This benefit will be applicable until April 15.
Moreover, the import-level VAT on refined and unrefined soybean oil and palm oil has been reduced from 15% to 10%. This translates to a 5% reduction in VAT at the import level for soybeans and palm oil.
Dates
The import duty on dates, a major item for breaking the fast during Ramadan, has been reduced by 10%.
At present, the import duty on dates stands at 25%, but it has been decreased to 15% in consideration of Ramadan.
Importers of dates will benefit from this 10% reduction in import duty until March 30.
Sugar
Furthermore, import duties have been lowered for both refined and unrefined sugar.
Import duty on unrefined sugar has been reduced to Tk1,000 per ton from Tk1,500, while for refined sugar, it has been reduced to Tk2,000 per ton from Tk3,000.
This duty exemption on the import of refined and unrefined sugar will be applicable until March 31, as per the NBR announcement.
