• Thursday, Aug 11, 2022
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Vehicle importers happy with 10% tariff cut on microbuses

  • Published at 08:09 pm September 5th, 2021
File photo of a 2015 Toyota Hiace Collected

Due to Covid-19, the demand for microbuses has gone up and 15-seater microbuses serve as substitutes for mass transportation

Vehicle importers have lauded the tariff reduction on 15-seater microbuses, saying this is likely to boost connectivity for the country and drive business growth.

Due to Covid-19, the demand for microbuses have gone up, industry insiders said, adding that 15-seater microbuses serve as substitutes for mass transportation in the tourism industry, offices, factories, hospitals, and educational students.

The National Board of Revenue (NBR) reduced import duty on 15-seat microbuses on Tuesday in a notification signed by NBR chairman Abu Hena Md Rahmatul Muneem.

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For microbuses with no more than 15 seats, the supplementary duty will not be more than 20%, the notification reads. 

Previously, the supplementary duty on 15-seater microbuses was 30%. 

In the budget for FY22, the supplementary duty on hybrid microbuses with engines between 1,801 and 2,000 CC capacity had been reduced from 45% to 30%.

And the supplementary duty on hybrid microbuses with engine capacity of 2,001 CC or more was reduced from 60% to 45%.

The Bangladesh Reconditioned Vehicles Importers and Dealers Association (Barvida) earlier this year had urged the government to reconsider supplementary duty on import of 10-15-seater microbuses, widely used as public transport.

At a post-budget press conference, they also demanded that the government grant their previous demand of 45% depreciation facility on import of reconditioned cars, as well as year-wise depreciation facility, as the finance minister did not make these proposals in his budget speech for FY22.

“We appreciate this decision taken by the NBR and the minister. We asked to remove the SD so that the people can afford to commute with ease amid the pandemic,” Abdul Haque, president of Barvida, told Dhaka Tribune. 

He added that this tariff cut will increase revenues for the government. 

“We are expecting that this year, import numbers may cross that of last year,” Haque further said.

The vehicle importer also noted that a collective strategy and market expansion is needed for the sector to grow. 

Haque said CC limit rationalization for cars is urgent as the government is losing a lot of revenue by levying heavy taxes and duties. 

“Sales of cars among the rising middle-income consumers is going to increase as Bangladesh is set to graduate into a developing nation from a least developed country [LDC],” he explained.

Sony Auto House Manager Abu Hena Zaman said: “We will be able to import more microbuses and there is a huge demand for these vehicles. Microbuses are mostly used for office, tours and transportation of patients.”

Also Read - ‘Sustained tariff policy can strengthen Bangladeshi automobile industry’

Barvida Secretary General Md Shahidul Islam said the government should create a competitive market for the buying and selling of new and reconditioned cars in consideration of the clients. 

“Over the past three years, about Tk20,000 crore has been invested in the sector and employment for nearly 50,000 people has been created as well,” he added.

According to customs and Barvida data, the government earned Tk686.77 crore in revenue from the import of 3,438 reconditioned cars in the July-November period of FY20, compared to 5,007 units in the corresponding period of the previous year.

Previously, the sector added Tk1,456.11 crore in revenue from 12,502 imported reconditioned cars in FY19, which was Tk2,649.95 crore from the import of 23,075 such vehicles in FY18.