Customs duty on sugar slashed; No visible impact on market

The government has slashed duties on sugar imports to half in order to improve the supply of sugar and contain the soaring prices of the essential commodity.

National Board of Revenue (NBR) issued a notification in this regard signed by its Chairman Abu Hena Md. Rahmatul Muneem on Wednesday. This order will be effective till March 31, 2024.

According to the order, a CD (customs duty) of Tk1,500 has been fixed for every metric ton of unrefined sugar and Tk3,000 for refined sugar.

Earlier, a CD (customs duty) of Tk3,000 has been fixed for every metric ton of unrefined sugar and Tk6,000 for refined sugar.

Although the National Board of Revenue (NBR) thinks that the duty cut would rein in the price of sugar, traders said it would not cast any visible effect in the market.

At present, sugar is being sold at Tk135 to 140 per Kg, which is 40 percent more than the last year. The traders say the Russia-Ukraine war, the dollar crisis and high tariffs are driving up sugar prices.

After implementation of the new order, Tk1.50 will be less than before for peunrefined suger while Tk3 for refined sugar which has no impact on the market.

Earlier, a total of 61 percent duty was levied on various types of imports of unrefined sugar. Due to the increase in the price of sugar and dollars in the world market, the amount of duty has also increased. As a result, traders had to multiply the duty of Tk31,000-32,000 per ton of sugar, which was Tk22,000-23,000 earlier.

According to the data, currently, 15 percent Value Added Tax (VAT), 2 percent AIT (Advance Income Tax), 30 percent RD (Regulatory Duty) and 5 percent AT (Advance Tax) are imposed on sugar import.

Earlier, the Ministry of Commerce has repeatedly requested NBR to reduce the duty, but no initiative has been taken in this regard. But now NBR is working to reduce the duty rate, considering the market situation.

According to Trading Corporation of Bangladesh (TCB) data, currently per kg sugar ibeing sold at Tk130 to Tk135 while it was Tk90 to Tk100 just a year ago. Accordingly, the price of sugar has increased by 39.47 percent during the period.

According to the updated data of the Bangladesh Bureau of Statistics, food inflation in the country was 12.37 percent in September.