New duties, VAT to affect construction sector
Monday, 14 June 2010
FE Report
Construction materials will be dearer following enhancement of duties on raw materials and VAT on finished MS rod, industry peoples said.
Cement will be affected most as the Finance Minister AMA Muhith in his budget speech proposed to enhance customs duty to 25 per cent on fly ash against existing 12 per cent.
He also proposed additional value added tax (VAT) of Tk 75 per tonne in addition to existing Tk. 350 on finished MS (mild steel) rod.
The proposal to impose 20 per cent supplementary duty locally produced paints, mosaics and tiles was slammed by the Foreign Investors' Chamber of Commerce and Industry (FICCI).
Industry people said that investment on the construction materials manufacturing sector will be discouraged following proposed increases in the customs duty and VAT.
Mostafa Kamal, managing director of Meghna Cement, told the FE: "These proposals will largely affect the basic industry."
Mr Mostafa, however, urged the government to review the proposed duty considering the chain effect on the prices of building material.
Mostafa, also president of Bangladesh Cement Manufacturers Association, alleged that vested quarters have been hatching conspiracy against the use of fly ash.
Only a few cement manufacturers use alternative materials to produce cement.
Jahangir Hossain, chairman of GPH Ispat told the FE: "Enhancement of VAT will affect the MS rod industry."
Aameir Alihussian, a director of the BSRM said that the prices of finished MS rod will increase as a result of tax increase.
Alamgir Hossain, a director of MI Cement Ltd., told the FE: "This duty hike will raise cement prices atleast by Tk 20 each 50-kg per bag."
Construction materials will be dearer following enhancement of duties on raw materials and VAT on finished MS rod, industry peoples said.
Cement will be affected most as the Finance Minister AMA Muhith in his budget speech proposed to enhance customs duty to 25 per cent on fly ash against existing 12 per cent.
He also proposed additional value added tax (VAT) of Tk 75 per tonne in addition to existing Tk. 350 on finished MS (mild steel) rod.
The proposal to impose 20 per cent supplementary duty locally produced paints, mosaics and tiles was slammed by the Foreign Investors' Chamber of Commerce and Industry (FICCI).
Industry people said that investment on the construction materials manufacturing sector will be discouraged following proposed increases in the customs duty and VAT.
Mostafa Kamal, managing director of Meghna Cement, told the FE: "These proposals will largely affect the basic industry."
Mr Mostafa, however, urged the government to review the proposed duty considering the chain effect on the prices of building material.
Mostafa, also president of Bangladesh Cement Manufacturers Association, alleged that vested quarters have been hatching conspiracy against the use of fly ash.
Only a few cement manufacturers use alternative materials to produce cement.
Jahangir Hossain, chairman of GPH Ispat told the FE: "Enhancement of VAT will affect the MS rod industry."
Aameir Alihussian, a director of the BSRM said that the prices of finished MS rod will increase as a result of tax increase.
Alamgir Hossain, a director of MI Cement Ltd., told the FE: "This duty hike will raise cement prices atleast by Tk 20 each 50-kg per bag."