With significant increase in international trade in recent decades, fiscal measures draw attention of many stakeholders. The government changes tax rates almost every year through passage of the Finance Bill by the Jatiya Sangsad (national assembly). Such changes in fiscal measures are a matter of interest for businessmen and investors who plan their projects, making projection of costs based on new tax rates -- enhanced or reduced.
Many of the local and foreign investors often face difficulties in knowing the actual rates of all forms of taxes, such as customs duty, regulatory duty, supplementary duty, and advance income tax (AIT), on products they produce or import. The National Board of Revenue (NBR) fixes the tax rates by issuing Statutory Regulatory Orders (SROs) -- circulars that are, in most cases, not easily understandable.
Investors, importers and other businesses need to calculate total tax incidence (TTI) before importing a product. TTI is comprised of taxes imposed by three wings of the NBR. The wings -- that deal with income tax, Value Added Tax (VAT) and customs duty -- issue three types of SROs that confirm imposition of taxes or exemption from taxes. It is hard for an individual importer to estimate cost of an item calculating various taxes scattered in the SROs.
However, all forms of taxes affecting thousands of import items have been accommodated in a recently published book titled 'Bangladesh Customs Tariff'. Compiled by Mohammad Ruhul Amin, an NBR official. It is meant for investors and commercial importers. The 2019 edition, the 9th one of the book, has incorporated all the measures of tax or exemption from it in the budget for fiscal year 2019-20.
There is comparison of tax rates of import items of two financial years. Separate sections of the book have elaborated on different tax rates on import items. It has also given updated information on tax rates applicable for all products. There is a specific section for minimum taxes and specific taxes. Products that would enjoy zero customs duty are also listed.
The book contains lists of products with their respective tax rates. The items include: live animals, animal products, vegetable products, animal or vegetable fats or oils and their cleavage products, prepared edible fats, animal or vegetable waxes, prepared foodstuffs, beverages, spirits and vinegar, tobacco and manufactured tobacco substitutes, mineral products, products of chemical or allied industries, plastics and articles thereof, rubber and articles thereof, raw hides and skins, leather, furskins and articles thereof, saddler and harness, travel goods, handbags and similar containers, articles of animal gut, wood and articles of wood, wood charcoal, cork and articles of cork, manufacturers of straw, of esparto or of other plaiting materials, basketware and wickerwork, pulp of wood or of other fibrous cellulosic material, recovered (waste and scrap) paper or paperboard, paper and paperboard and articles thereof.
There are updated tax structures for textile and textile articles, footwear, headgear, umbrellas, sun umbrellas, walking sticks, seat sticks, whips, riding-crops and parts thereof, prepared feathers and articles made therewith, artificial flowers, and articles of human hair.
The book contains tax rates for import of articles of stone, plaster, cement, asbestos, MICA or similar materials, ceramic products, glass and glassware, natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal and articles thereof, imitation jewellery, coin, base metals and articles of base metal, machinery and mechanical appliances, electrical equipment, parts thereof, sound recorders and reproducers, television image and parts and accessories of such articles.
Also included in the book are tax rates for vehicles, aircraft, and vessels and associated transport equipment, optical photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus, clocks and watches, musical instruments, parts and accessories thereof. Tax rates for imports of arms and ammunition, parts and accessories thereof, miscellaneous manufacturing articles, works of art, collectors' pieces and antiques are also there.
The government has this year imposed a new type of tax called advance tax (AT) at a rate of 5.0 per cent by replacing the advance trade VAT (ATV), on all import items, except few products.
General rules for interpretation of harmonised system are also included in the book which is full of information on rates of taxes that are necessary to industrial entrepreneurs, businesses, importers, exporters, agents and researchers.