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Despite the reduction in crude soybean and palm oil prices
in the international market, consumers in Bangladesh are not getting the
benefit. Because the cost of importation is paid in US Dollars, the price has
gone up.
Bangladesh Trade and Tariff Commission recently said this in
a report sent to the Ministry of Commerce. According to the commission's
report, the import of crude soybean and palm oil is currently exempted from a 10
percent value-added tax (VAT). The agency has recommended that it continue till
June 30, 2023, in the interest of consumers. The earlier exemption will expire
after a week i.e. on September 30.
Considering the purchasing power of the consumer, the Tariff
Commission feels that VAT exemption is necessary not only at import but also
at the level of production and business to maintain stability in the price and
supply of edible oil.
The Tariff Commission prepared this report in the context of
the decision to fix the prices of 9 products in a meeting held under the
chairmanship of Commerce Minister Tipu Munshi on August 30.
Commerce Secretary Tapan Kanti Ghosh said, "A letter
has already been sent to the National Board of Revenue (NBR) highlighting the
importance of 10 percent VAT exemption." Hopefully, NBR will take it into
consideration.
According to the report, the producer's profit per liter of
edible oil could be reduced from 2 percent to 1 percent, distributor's profit
from Tk 4 to Tk 2 & 50 paise and retailer's profit from Tk 6 to Tk 4 &
50 paise.
Apart from this, in the case of sugar, the producer's profit
per kg may be reduced from 2 percent to 1 percent, the distributor's profit from Tk
2 to 1, and the wholesaler from Tk 3 to 2.
Companies say that processing losses are 4.25 percent when
refining raw soybeans. And in the case of sugar, this rate is 6.5 percent. This
loss is considered in pricing.
The report recommended soybean loss at 3 percent and sugar loss at 4 percent. The officials of the Ministry of Commerce say that now the factories are running with modern equipment. As a result, processing losses are no longer as before.
The Tariff Commission has been reviewing the price of edible oil and sugar as per a uniform pricing system for nearly 10 years. They use letters of Credit (LC) and customs clearance information. According to the report, since the exchange rate of the dollar has been stable for a long time, the traders did not have any objection.
Since May this year, there has been a big difference between the
dollar exchange rate fixed by the government and the dollar exchange rate in
the open market (curb market). As a result, traders will suffer losses if they
are calculated according to the conventional method. So they disagreed with it.
The first vice-president of the Federation of Bangladesh
Industrial and Commercial Societies (FBCCI) Mustafa Azad Chowdhury said,
"If you buy dollars at the rate of Tk 105 to Tk 110 and open an LC to
import products, it becomes a lot of force not to take it into account in the
calculation." If you do this, no one will open LCE in the future.
According to the report of the Tariff Commission, the prices
of edible oil and sugar will increase and cause dissatisfaction among consumers
if the prices are fixed according to the demands of the traders. However, the
report has sought guidance from the Ministry of Commerce on whether the
objections of traders will be taken into consideration.
Commerce Secretary Tapan Kanti Ghosh said that the prices of
palm oil and sugar had been slightly reduced. Businessmen demand to calculate
the price of 105 rupees per dollar. Due to this, it was impossible to reduce soybeans' prices. It is being worked on.
A committee of the Tariff Commission formed to review the
market situation decided that it would not be reasonable for them to fix the
price of rice. This decision can be jointly taken by the Ministry of Food and
Agriculture and the Bangladesh Bureau of Statistics (BBS). It would be contradictory
for the Ministry of Commerce to do anything. But it will take 5 days to say
something about lentils, flour, and flour.
Meanwhile, on September 18, the Tariff Commission sent a
separate report to the Ministry of Commerce and said that there is a huge difference
in the price of rods and cement depending on the quality and grade. It will
take 20 working days to determine the price of these two.
Bangladesh Trade and Tariff Commission Chairman Mahfuza
Akhtar said, "I have sent two interim reports. Work is going on with
lentils, flour, flour, rods, and cement. We asked for time. I hope that a good
report will be prepared.
|Source: Online/SZK
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