NBR will gradually rationalize 60 tariff lines by 2026

The National Board of Revenue (NBR) has made a move to gradually rationalize around 60 tariff lines where the addition of customs duty and other taxes and duties exceed the captive tariff and bring them under the cap rate by 2026.

“NBR has also set 60 tariff limits where the addition of customs duty and other duties and charges exceeds the bound tariff. These rates will be gradually rationalized and brought below the cap rate by 2026,” the government said in an official document on medium-term macroeconomic policy. expression.

He said Bangladesh is planned to graduate from the list of underdeveloped countries in 2026 and the country is now actively preparing for the post-graduation period.

The document stated that, taking into account the interests of the domestic industry and with the aim of increasing the competitiveness of export products, a strategy has been developed to gradually reduce tariffs at the import stage, where applicable.

“These include plans to review Bangladesh’s program at the WTO to bring customs duties to borders, phase out minimum import prices and streamline Additional Duties (SD) and Regulatory Duties (RD).”

It was stated that NBR carried out a study in which it reduced customs duties on six products in order to bring Bangladesh’s tariff regime in line with the limit rates accepted by Bangladesh in the World Trade Organization.

The government also decided to abolish minimum import prices and developed a plan to gradually reduce them by 2026.

In order not to negatively affect the local industry and revenue mobilization, customs duty and other taxes and duties at the import stage will be gradually rationalized instead of serious cuts.

Regulatory Duty (RD) imposed on 191 products and Additional Duty (SD) imposed on 234 products have been withdrawn from the budget for FY24.

“SD and RD for intermediate goods will be phased out/withdrawn over the next three fiscal years,” according to the official document.

The government has formulated the National Tariff Policy 2023 to increase the competitiveness of local companies in the international market.

The National Tariff Policy 2023 came into force on August 10 last year and has been implemented gradually.

This Policy aims to rationalize Bangladesh’s tariff structure in line with WTO rules, promote export diversification and facilitate the signing of free trade agreements with potential key trading partner countries.

From a fiscal perspective, the plan is to move away from heavy reliance on business taxes in the medium and long term to focus more on direct taxes and VAT, according to the document.

Reducing dependence on import duties is also expected to reduce the anti-export bias of the country’s trade policy; Therefore, the revenue loss from tariff rationalization will likely be offset by strong growth of local businesses, he added.

Bangladesh is scheduled to exit the Least Developed Country (LDC) status on 24 November 2026. This decision was taken by the UN General Assembly in 2021.