FE Today Logo

Cut in depreciation facility

Prices of used cars go up

FE Report | June 13, 2018 00:00:00


A cut in the depreciation facility in the proposed budget has pushed up the prices of reconditioned cars by Tk 0.1 million to Tk 0.45 million.

Bangladesh Reconditioned Vehicles Importers and Dealers' Association (BARVIDA) has said this at a post-budget press conference at the National Press Club in the capital.

The reduction in the depreciation facility has been made in the Finance Bill-2018.

The fiscal measure came into effect from June 7.

Year-wise depreciation facility has been cut by 5.0 percentage point for import of reconditioned cars.

This applies to all types of cars, including hybrid cars regardless of their engine capacity.

Speaking at the event, BARVIDA President Md Habib Ullah Dawn said the government has encouraged import of substandard new cars with this measure.

"Those new cars are usually imported from third country. They also threaten the environment," he added.

Mr Dawn, however, welcomed the move to encourage import of environment-friendly hybrid cars.

Md Abdul Hamid Sharif, former president of BARVIDA, said prices of reconditioned cars would go up beyond 5.0 per cent due to an ad-valorem duty structure.

An upward adjustment of Advance Trade VAT (ATV) by 1.0 percentage point for the next fiscal year (FY) would also cause an escalation in the prices, he stated.

The BARVIDA leader demanded reintroduction of the depreciation facility of the current FY.

The BARVIDA has sought a 10 per cent cut in value as dealer/trade discount on actual prices of new cars quoted in the yellow book.

The customs authorities calculate duty of a used car against its price after its year-wise depreciation.

The BARVIDA leaders said the middle-income groups have to carry an additional tax burden due to a cut in the depreciation facility.

Mr Dawn said the fiscal measure has facilitated the well-off people who can import new cars.

Existing duty structure is faulty as tax on new cars is less than that of the reconditioned cars, he added.

"This happens because customs authorities accept prices of new cars declared by importers after some adjustment," he mentioned.

According to BARVIDA data, the import of reconditioned car increased 34 per cent to 17,727 units year on year during the July-February period of the current FY.

The BARVIDA leaders said the overall import of used vehicles would fall for the discouraging tax measure.

doulot_akter@yahoo.com


Share if you like



COMPANY YCP HIGH LOW CLOSE %CHG
PARAMOUNT 17.0 18.7 16.7 18.7 10%
GLOBALINS 12.8 14.0 12.7 14.0 9.375%
MEGHNACEM 91.1 99.9 92.1 98.1 7.6839%
PROVATIINS 16.4 17.7 16.5 17.5 6.7073%
PURABIGEN 12.4 13.5 12.5 13.2 6.4516%
ASIAINS 16.7 17.7 17.0 17.6 5.3892%
KARNAPHULI 15.0 15.9 15.0 15.8 5.3333%
REPUBLIC 25.1 27.2 25.3 26.4 5.1793%
MIDASFIN 23.1 24.4 23.3 24.2 4.7619%
PRIMEINSUR 12.7 13.6 12.9 13.3 4.7244%
COMPANY YCP HIGH LOW CLOSE %CHG
GLOBALINS 14.0 14.0 12.7 12.7 10.2362%
PARAMOUNT 18.7 18.7 16.7 17.0 10%
GREENDELT 58.9 59.0 52.5 54.0 9.0741%
PURABIGEN 13.3 13.5 12.5 12.5 6.4%
PROVATIINS 17.4 17.7 16.5 16.5 5.4545%
MEGHNACEM 97.0 99.9 92.1 92.1 5.3203%
IFIC1STMF 4.2 4.2 4.0 4.0 5%
POPULAR1MF 4.2 4.2 4.0 4.0 5%
DAFODILCOM 34.9 35.1 33.3 33.3 4.8048%
FASFIN 13.5 13.6 12.8 12.9 4.6512%
COMPANY YCP HIGH LOW CLOSE %CHG
ALLTEX 14.0 14.4 12.6 12.6 -10%
AL-HAJTEX 98.2 105.3 88.4 88.4 -9.9796%
ISNLTD 31.5 28.4 28.4 28.4 -9.8413%
CAPMIBBLMF 11.5 11.6 10.4 10.4 -9.5652%
JUTESPINN 148.4 152.9 133.6 134.6 -9.2992%
KEYACOSMET 7.6 7.3 6.8 6.9 -9.2105%
KTL 29.7 30.2 26.8 27.0 -9.0909%
MLDYEING 39.6 40.3 35.8 36.2 -8.5859%
IBP 36.9 37.0 33.5 33.8 -8.4011%
GQBALLPEN 82.5 84.5 75.0 76.1 -7.7576%
COMPANY YCP HIGH LOW CLOSE %CHG
AL-HAJTEX 88.4 105.3 88.4 101.3 -12.7345%
ALLTEX 12.6 14.4 12.6 14.4 -12.5%
GQBALLPEN 75.0 84.5 75.0 84.4 -11.1374%
CAPMIBBLMF 10.4 11.6 10.4 11.6 -10.3448%
JUTESPINN 133.6 152.9 133.6 149.0 -10.3356%
KTL 27.0 30.2 26.8 29.9 -9.699%
MLDYEING 36.2 40.3 35.8 39.7 -8.8161%
IBP 33.9 37.0 33.5 37.0 -8.3784%
PRIMELIFE 53.8 59.7 53.8 58.0 -7.2414%
ARAMIT 431.1 463.0 429.0 463.0 -6.8898%