Reconditioned car traders urge tax reforms to make imports affordable

Reconditioned car traders on Saturday urged the government to rationalise taxes on imported vehicles to make them more affordable for consumers.

At a press conference, the Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) called for a series of policy changes, including lowering customs duties on hybrid cars, exempting microbuses from supplementary duty, and eliminating what they termed as discriminatory registration fees between new and reconditioned vehicles.

These proposed reforms are imperative to boost government revenue and enhancing safety and security in the transport sector, they said.

The BARVIDA leaders placed the demands at the press conference titled 'Seeking policies congenial to BARVIDA's business as well as friendly to consumers and revenue collection' ahead of the national budget for 2025-26.

BARVIDA President Abdul Haque, its Secretary General Reaz Rahman, Vice Presidents Saiful Islam (Samrat) and Farid Ahmmed and Joint Secretary General Syed Juglul Hossain were present.

Mr. Haque said reconditioned car importers faced severe setbacks during the COVID-19 outbreak in 2020 and 2021.

Subsequently, imported reconditioned cars became significantly more expensive for consumers due to a foreign currency crunch, devaluation of the local currency, and rising prices in sourcing countries.

"As four-wheeler prices moved beyond the reach of middle- and lower-middle-income families, both the import and sales of reconditioned cars in the country dropped sharply," he said.

Highlighting the growing environmental concerns and the global shift away from fossil fuels, Mr. Haque said hybrid cars are gaining popularity among consumers.

"We have proposed a restructuring of the supplementary duty and the CC slab for hybrid cars to make them more affordable, so that consumers benefit and government revenue increases," he said.

Terming the transport sector the lifeline of the country's economy, the BARVIDA president said microbuses play a crucial role in the country, but excessive supplementary duties are placing a significant burden on this segment.

To address the issue, BARVIDA has called for the imposition of a fixed duty on microbus imports.

The trade body also stressed the importance of formulating a comprehensive and widely accepted policy for the import and use of electric, hybrid, plug-in hybrid, and hydrogen-powered vehicles through inclusive discussions with all relevant stakeholders.

In addition, imported car dealers urged the government to lower import duties on pickups and vans, and to grant full exemption of value added tax (VAT) on ambulances.

BARVIDA also pointed out a disparity in registration fees between reconditioned and brand-new cars, noting that reconditioned vehicles currently incur an additional cost of Tk 27,508 to Tk 53,958 depending on engine capacity (CC).

According to data available with the Bangladesh Road Transport Authority (BRTA), nearly 3,07,800 vehicles were registered last year, the lowest since 2015.

BRTA registered 3,60,000 vehicles in 2023 and 5,78,000 in 2022, indicating a lower trend in import and sales of such vehicles.

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