Welcome to Business Outlook
Related Articles
The customs authority yesterday reduced import tariff for onion and raw sugar in order to cut costs of businesses and contain the spiralling prices of the two popular items, according to notifications from the National Board of Revenue (NBR).
The NBR removed 5 per cent customs duty on import of onion while keeping 5 per cent regulatory duty on the popular cooking ingredient unchanged.
Importers will be able to bring the bulbs paying 5 per cent tariff until December 31 this year.
In case of raw sugar, the customs authority reduced regulatory duty to 20 per cent from 30 per cent.
However, import duty on raw sugar, now at Tk 3,000 per tonne, along with a 15 per cent VAT and 3 per cent advance tax, remains unchanged, said an NBR official.
The NBR said the reduced regulatory duty for sugar import would remain valid until February 28 next year.
The customs authority’s move followed a commerce ministry request for import tariff cuts in the wake of soaring prices of onion and sugar for which Bangladesh relies on the international market.
And because of the import dependence, businesses hike prices of these commodities here whenever there is a spike in prices in the international market.
Over the past one month, prices of onion, used mainly for preparing foods, shot up as much as by 49 per cent, influenced by soaring prices in India, the main source for Bangladesh to meet its domestic requirement.
Yesterday, locally grown onion was traded at Tk 60 to Tk 70 per kilogramme in Dhaka markets, up 49 per cent from Tk 42 to Tk 45 a month ago, showed market data compiled by the Trading Corporation of Bangladesh (TCB).
Imported onions were sold at Tk 56 to Tk 60 per kilogramme yesterday, which was 47 per cent higher than the prices a month ago, according to the TCB data.
Bangladesh imports around 7 lakh tonnes of onion annually, mainly from neighbouring India since its domestic production falls short of its requirement of 25 lakh tonnes a year, according to an estimate of the Bangladesh Trade and Tariff Commission (BTTC).
“A sudden price increase in India has affected prices in our domestic market, although there is a good stock of locally grown onions,” said Dipankar Ghosh, organising secretary of C&F Agents Association at Bhomra, one of the main onion importing land ports from India.
“People holding locally produced bulbs hiked prices taking advantage of higher prices in India,” he said.
He said import cost would reduce by Tk 2.7 per kilogramme following removal of customs duty by the NBR. Prices may decline by Tk 2 on each kilogramme, he added.
The government has imposed a total of 10 per cent tariff on onion import—5 per cent customs duty and 5 per cent regulatory duty—in January this year to protect interests of local growers.
The BTTC estimates that Bangladesh’s annual demand for sugar is 18 lakh tonnes and locally grown sugarcane, crushed in state mills, account for only 30,000 tonnes.
Private sugar refiners supply the rest of the sweetener by refining imported raw sugar.
Sugar prices edged up 4 per cent to Tk 79 to Tk 80 each kilogramme yesterday from Tk 75 to Tk 78 a month ago, showed the TCB data.
(TDS)
