The
National Board of Revenue may increase duty on tea import as a move to protect
local producers from uneven competition with the imported ones, officials said.
They
said that the customs wing of the revenue board was now scrutinising details of
the sector following an application of Bangladesh Tea Association for
increasing duty on tea import.
BTA
on late January demanded that the NBR should increase duty on import of tea by
at least 25 per cent to discourage import claiming that local growers had been
facing tough competition with imported tea due to low import duty on the
product.
Currently,
there is a total of 84.50 per cent duties and taxes including 25 per cent
customs duty, 15 per cent supplementary duty, 15 per cent value-added tax, 5 per cent regulatory duty, 5 per cent
advance income tax and 4 per cent advance trade VAT on tea import.
BTA
sought an increase of total duty on the product to 110 per cent.
Officials
said that customs wing was now collecting information related to annual
production, demand and cost of production of the product to take final decision
on increasing duty on import.
Customs
wing has already instructed its field office—Customs, Excise and VAT
Commissionerate, Sylhet—to provide data containing annual production and demand
starting from fiscal year 2010-2011.
It
also sought information on cost of production and VAT applicable price of the
product, they said.
After
getting information from the field office, the revenue board will hold meetings
with stakeholders on this issue, they added.
The
NBR will take decision on increasing duty in the national budget for the next
financial year after analysing data and getting stakeholders’ opinion.
According
to BTA, duty on tea import is high in neighboring tea producing countries like
India and Sri Lanka.
In
India, the rate of duty on import of tea is 110 per cent while that is 130 per
cent in Sri Lanka.
Tea
import has been increasing since 2010 and 4.13 million kg of the item was
imported in the country in that year.
Though
tea import fell sharply in 2012 to 1.92 million kg as a result of imposition of
20 per cent supplementary duty on it in the financial year 2012-2013, import of
the product again skyrocketed to 10.62 million kg in 2013 due to the withdrawal
of the duty.
In
April 2014, the revenue board increased regulatory duty to 15 per cent from 5
per cent in line with the repeated demand from the tea growers and its import
fell down to 6.96 million kg in the year.
According to Bangladesh Tea Board, Bangladesh
produced 66.26 million kg of tea in 165 tea estates in 2013 against the average
internal consumption of 64 million kg in the year. (Source: New Age, April 1,
2015)