Taxes on coal import waived

The government waived Monday the duty and taxes on import of coal. The waiver came following a ban imposed by Indian state of Meghalaya on export of its coal.
Officials said Customs and Value Added Tax (VAT) wings of the National Board of Revenue (NBR) waived the import duties and advance trade vat (ATV) following a Statutory Regulatory Order (SRO) Monday.
Internal Resources Division (IRD) secretary Ghulam Hussain signed the SRO exempting the item--'other coal' under HS code 270.19.00-from being taxed.
The officials said the import duty was waived following demand of the local brick-manufacturing companies. Imported coal is being used by brick kilns.
The Indian State of Meghalaya imposed a ban on coal mining on May 17 following a petition by an environmental organisation.
Bangladesh imports 1.6 million tonnes of coal--about 80 per cent of its demand--from the northeastern Indian state.
Following the ban, many brick manufacturers have suspended operation of their brick kilns due to non- availability of imported coal.
A senior customs official said the situation was taking a turn for the worse for scarcity of coal after the ban. The brick manufacturers are about to start felling trees for burning bricks, he said.
"We have waived the import duty to facilitate import from other countries, including Vietnam, Indonesia and China," he said.
Some ships with coal have already started heading towards Bangladesh to meet the demand, he added.
The officials, however, admitted that the import duty has been waived following strong recommendation from the Ministry of Commerce.  
The revenue board would also scrap advance income tax (AIT) on the import of coal shortly. Tax incidence on coal import was some 30 per cent, inclusive of 4.0 per cent ATV, 5.0 per cent customs duty, 5.0 per cent AIT and 15 per cent VAT.
From now on, importers would have to pay 15 per cent VAT while enjoy waiver of other import duties.
Coals in other categories, including anthracite and bituminous, would not be entitled to enjoy the duty-exemption as those are not used in brick kilns.
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