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First LNG import delivery to enjoy duty waiver

FE Report | April 28, 2018 00:00:00

The first Liquefied Natural Gas (LNG) shipment, which arrived on Tuesday, will enjoy duty-benefit through an undertaking.

The importer of LNG will be able to release goods enjoying exemption from the payment of all types of import duties except 15 per cent Value Added Tax (VAT) and 2.0 per cent Advance Income tax (AIT).

The first LNG cargo of QatarGas aboard arrived at the Moheshkhali LNG terminal for re-gasification.

The customs wing of the National Board of Revenue (NBR) instructed the Chittagong Custom House to permit the release of LNG after an undertaking from the Ministry of Power, Energy and Mineral Resources.

"There is an instruction from the government's high-up to allow the import of LNG without paying import duty, except VAT and AIT," the board said in an order.

Officials said that the statutory regulatory order regarding the exemption from duty on LNG import is under process.

The customs will allow the importers of LNG to get the duty-benefit until the order is finalised.

A senior customs official said the importers of LNG will not have to pay 5.0 per cent customs duty, 4.0 per cent advance trade VAT (ATV), apart from 15 per cent VAT and 2.0 per cent AIT, if they submitted the undertaking with the bill of entry in the customs house.

The NBR issued the letter to the Chittagong Customs House as an interim order relating to the duty waver.

The LNG is being imported under government to government agreement between Petrobangla and Ras Laffan Liquefied Natural Gas Company Limited.

The commercial supply of re-gasified LNG to national gas grid might start from mid-May to supply the fuel to the consumers' end.

The Qatargas Operating Company Limited delivered the first LNG cargo to Bangladesh as part of a long-term sale and purchase agreement with the Petrobangla.

In September 2017, the Petrobangla signed the agreement with Qatargas to import 2.5 million tonnes of LNG annually for 15 years.

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