15pc VAT back on rod import

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Jasim Uddin Haroon
Local rod manufacturers have heaved a sigh of relief following issuance of a Statutory Regulatory Order (SRO) slapping 15 per cent VAT on rod import.
The National Board of Revenue (NBR) issued the SRO on May 12 with immediate effect re-imposing the 15 per cent value added tax (VAT), which was withdrawn in mid-2008 to facilitate rod import to cool down the local market during the period.
Rod manufacturers claimed that imposition of the tax on rod import would help protect the local re-rolling mills, which made huge investments and created jobs.
Importers so far have marketed around 60,000 tonnes of steel products, mostly 60-grade mild steel (MS) rod, and 40,000 more tonnes are in the pipeline, sources said.
Aameir Alihussain, managing director of the BSRM Steels, told the FE: "We are happy with the issuance of the SRO as it will help protect the local re-rolling mills."
He said the government should also raise the import duty to the level of 15 per cent. He added: "There are still chances to dump steel products in the local market seizing the opportunity of the minimum import duty."
Currently, the import duty on purchase of steel products is 7.0 per cent.
Md Bashirullah, secretary general of Bangladesh Steel Mill Owners Association, said: "The government should have imposed the VAT much earlier, as more than 100,000 tonnes of rod are flooding the local market."