Local refiners have demanded that the government withdraw all duties on sugar import and instead introduce specific duty per tonne as the price of the commodity is soaring in the local market.
The Bangladesh Sugar Refiners Association (BSRA) on May 29 submitted a proposal to the Ministry of Commerce, requesting it to take necessary steps in this regard to keep its supply and prices stable in the market, according to sources.
The ministry has already requested the National Board of Revenue (NBR) to extend with the existing duty rebate on sugar import, which is supposed to end on Tuesday, until August 31 next amid a notable price hike in the global market.
The revenue board is yet to inform the commerce ministry whether it would continue with the facility, a commerce ministry official told the FE on Tuesday.
The refiners are used to importing or booking raw sugar from the producing countries at different times and lots so the import prices also differ, according to the association.
As per the present duty structure, the production cost would be higher if the prices of imported raw sugar are high, the BSRA claimed.
Contacted, a sugar refiner said, "We requested the government to impose specific duty on import of raw sugar, withdrawing all the existing CD, RD, VAT, AIT and AT."
The total tax incidence on import of sugar is higher than that of the other essential commodities, he added.
"We received a letter from the sugar refiners' association recently and are already working on it. Recently, we requested the NBR regarding the duty issue," said a high official of the commerce ministry.
At present, some 15 per cent VAT is applicable to raw sugar import while the customs duty is Tk3,000 per tonne, according to a Bangladesh Trade and Tariff Commission (BTTC) report.
A 25 per cent regulatory duty (RD) is applicable to the sugar import from February to May 30, 2023, following a 5.0 per cent waiver from the previous 30 per cent.
Currently, the government imposes 2.0 per cent and 5.0 per cent advance income tax (AIT) and advance tax (AT) respectively. However, there is no VAT at the production stage of raw sugar.
Sugar has become both scarce and expensive in the market despite various steps taken by the government to bring the situation under control.
Currently, sugar is being sold at rates higher than the government-fixed price, according to market sources.
According to traders of different kitchen markets in the city, the sweeter is being sold at Tk 140/150 a kg despite the government fixing it Tk 120-125 a kg on May 4, 2023.
The annual demand for sugar in Bangladesh is 2.0-2.2 million tonnes. Some 2.2-2.4 million tonnes of raw sugar is imported annually.
More or less 50,000 tonnes of refined sugar is imported annually, according to the BTTC.
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