The government is all set to increase the tariff value and impose Value Added Tax (VAT) on the imported sugar for protecting the domestic state-run sugar mills.
Subsequently, consumers are likely to feel the burden of the increased tariff and VAT for consuming sugar, an essential daily commodity.
Finance Ministry officials said: “The government is going to hike the tariff value on import duty on both the raw and refined sugar along with imposition of 15% VAT, following a proposal from the National Board of Revenue (NBR).”
As Finance Minister AMA Muhith has recently approved the proposal, NBR is now working on the issuance of a Statutory Regulatory Order (SRO) in this connection.
According to the proposal, the government will hike the import tariff value to US$350 per tonne in crude sugar and $430 per tonne in refined sugar from the existing $320 and $400 respectively for each tonne.
In addition, a 15% VAT will also be imposed on the tariff value of the product during imports.
Once the duty is hiked, consumers may have to pay additional Tk7 for consuming refined sugar and the price may reach at Tk46 to Tk47 a kilogram, officials said.
Bangladesh Sugar and Food Industries Corporation (BSFIC) under the Industry Ministry had earlier proposed the government to hike the duty on imported sugar.
According to the BSFIC proposal, the corporation was facing financial crisis due to its failure in selling of the stockpiled sugar and drop in price of the product in international market.
The sugar mills are facing trouble in continuing production and paying prices of sugarcane to farmers due to fund crisis, it added.
Following the proposal, Prime Minister Sheikh Hasina on November 23 instructed the NBR to take necessary steps in this regard.
Later on, tax authorities sent the proposal for duty hike to the Finance Minister who has finally approved the scheme.
According to NBR officials, a SRO will be issued shortly in line with the approval from the Finance Minister.
Earlier in August 26 this year, the NBR has increased import duty on raw and refined sugar by Tk5,000 and Tk6,000 per tonne respectively on the same ground.