The government is likely to create a new customs duty slab in the existing structure in a bid to remove inconsistency in the structure and give protection to local producers, finance ministry officials said. They said that the customs wing of the National Board of Revenue might also review the current duty structure for import purpose to rationalise the structure for making it more business friendly. Finance minister Abul Maal Abdul Muhith may include the proposals relating to creation of new customs duty slab at 15 per cent for mainly intermediate raw materials in the budget to be placed in parliament on June 2. Officials said that the customs duty structure would be a five-tier one through adding the new slab to the existing four tiers which are capital machinery, basic raw materials, intermediate raw materials and finished products. The initiative will also help the customs authority to improve the existing structure, they said. Currently, zero per cent duty is applicable on import of essential goods defined by the NBR, 1 per cent and 2 per cent for capital machinery, 5 per cent for basic raw materials, 10 per cent for intermediate products and 25 per cent customs duty for finished consumer goods. The category of products will be changed in duty structure in line with the use of the products for consumption and industrialisation. A study report of the Federation of Bangladesh Chambers of Commerce and Industry last month revealed that the existing customs tariff structure was not efficient and business-friendly due to faulty categorisation system in duty rates on import of basic raw materials, intermediate products and finished consumer goods. The study report found that there were many incidences of overlapping in application of duty structure such as many basic raw materials fall under other high duty rates while many finished goods fall in low duty rates under the existing tariff structure. Officials said that many intermediate goods which are used as raw materials are also being produced in the country fall under lower duty rates causing lower protection for domestic industry. The new slab will solve the problem, they said. The government may also generally reduce the rate of regulatory duty to 3 per cent from the current 4 per cent while for some products it may be increased in a bid to ensure protection for local industry. The government may also increase customs duty in import of equipments for luxury hotels to 10 per cent from the current 5 per cent while 1 per cent customs duty may also be imposed on import of medical equipments by the referral hospitals which are now enjoying zero duty benefit.
