SDs on 200 goods likely to be changed
Al Amin :
The National Board of Revenue (NBR) is planning to bring changes in Supplementary Duty (SD) rates on 200 products in order to reducing trade barriers and to facilitating the international business, official sources said.
They changes in SD rates are expected to help the local businesses to face the challenges of the LDC graduation of the country.
Under the changes, the SD rates will be reduced on goods on some goods and will be withdrawn completely on some products, the NBR officials said.
They further said that the SD rates on more 400-450 goods will also be changed gradually by 2026 with a view to easing the international trades.
Usually, the SD is imposed on products like luxurious, non-essential and socially not encouraging and it can be imposed on both imported and locally manufactured goods.
In case of imported goods, assessable value plus import duty is the base value for imposition of SD, for the locally manufactured goods, the value excluding VAT and SD and for services, total receipts excluding VAT and SD.
After the LDC graduation in 2026, Bangladesh will have to sign Free Trade Agreements (FTAs) and Preferential Trade Agreements (FTAs) with other countries as the country may lose export earnings worth around $7 billion. And the SD rates may create obstacles to sign the agreements during that time.
Besides, the country’s exporters will have to face strong competitiveness for the higher duty during the time. Keeping the situation in mind, the NBR is going to take the decision, the NBR officials said.
Currently, there is SDs on 1926 goods in the country.
Along with the change in SD, the revenue board is likely to reduce or to withdraw Regulatory Duty (RD) on 200-250 products to facilitate the international trades in the next budget, the officials also said.
The decision will help to increase bilateral trades to sign FTAs with other countries, the officials said.
Dr Zahid Husain, former lead economist of the World Bank Dhaka office told The New Nation, “The decision is a good initiative to face the LDC challenges. It will help the local exporters to be more competitive as they lose duty benefit after the graduation.”
“Besides, Bangladesh will to be faced challenges in the case of signing various trade deals due to the existing high SD and RD rates. So, the decision will reduce the pressure during the time,” he added.
The initiative will also encourage the exporters, the economist added.
The government is trying to bring the changes in SD rates as the rate is high and it cannot be changed frequently.
On the other hand, the RD rate is comparatively low (3 per cent) and it can be changed at any time of the year by issuing SRO.
