The National Board of Revenue (NBR) will lose revenue worth Tk 9.55 billion in fiscal 2008-09 for considerable readjustment of the duty structure in the proposed budget.
The government has proposed four-tier duty structure in the upcoming fiscal budget lowering duty slab for capital machinery to help the local manufacturing industry grow.
The NBR will incur loss amounting to Tk 10.25 billion due to restructuring duty slab while Tk 600 million for duty reduction on scrap iron.
Recently, the NBR sent a report to the finance ministry elaborating the impact of proposed budget on revenue earning.
The government's proposed duty slabs are: 3.0 per cent, 7.0 per cent, 12 per cent and 25 per cent. Existing duty structures are: 10 per cent, 15 per cent and 25 per cent.
The government, however, tried to minimise the loss by readjusting customs duty on other products.
The government has proposed withdrawal of existing provision of duty-free import of capital machinery against the indemnity bond for 100 per cent export-oriented industry.
It has proposed imposition of 1.0 per cent duty on import of capital machinery under indemnity bond in the backdrop of widespread allegation of abusing bond facility.
The NBR will be able to collect additional revenue worth Tk 700 million due to the measure.
The government has proposed an increase of 'specific duty' for importing refined sugar by Tk 1000 to Tk 6000 per tonne.
From this readjustment, the NBR estimated an additional revenue of nearly Tk 600 million from import of refined sugar.
The NBR insiders said although the government will lose a significant amount of duty in the upcoming fiscal due to massive change made in duty structure it will bring long-term benefit in the economy.
"The government has proposed the fiscal measures aiming to offer business friendly environment, encourage investment in industries and facilitate import of raw materials," an official said.
The duty reduction will, however, spur economic growth that will in turn offset the effect of revenue losses.
In the proposed budget, the government reduced customs duty for 15 products and raised it for19 items.
It has reduced supplementary duty (SD) for 20 products, imposed specific duty on three items and offered special duty-facility to 11 products.
The government set Tk 225.36 billion, 41.0 per cent of the total revenue target, as collection target for customs department for fiscal 2008-09, up by 16.25 per cent from Tk 193.85 billion target for outgoing fiscal.
The customs department collected Tk 169.40 billion up to May 2007-08.
Readjustment of duty structure to cause Tk 9.55b revenue loss
Doulot Akter Mala | Published: June 13, 2008 00:00:00 | Updated: February 01, 2018 00:00:00
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