Sudden SD on limestone inflates costs for many products

Sudden SD on limestone inflates costs for many products
Sudden SD on limestone inflates costs for many products

The sudden levy of high additional duties on limestone imports increases the cost of manufacturing a plethora of products like cement, paper, etc. in local industries.

Industry insiders say the customs wing of the National Revenue Board (NBR) is charging import taxes of 69%, down from the previous 37%, on the import of limestone in recent times.

They say the cost of producing cement would increase by Tk 10 per bag as a result of increased taxes on limestone, its main raw material.

Syed Khalid Hossain, Deputy Managing Director of Meghna Group of Industries, says it is against the principle of customs law to impose SD on the raw materials of an industrial product.

Not only cement, the cost of production of leather, paper, PVC pipes, plastic products, electric cables, detergents and some other industrial products would increase following the sharp increase in taxes on limestone, adds he.

Calcium carbonate, a raw material for the production of paper and many other industries, is also produced with limestone.

Mr. Hossain points out that there is no definition in the customs legislation as to the size of the rocks that would be considered as raw materials to guide importers.

A senior NBR official said he has received applications from various sectors lately and will discuss the matter with senior council officials soon.

“The HS code on the import of limestone has been changed in line with the World Trade Organization (WTO) explanatory notes on crushed limestone, as it was previously imported under the wrong HS code,” he said. at the FE.

The NBR held a meeting following a memo from Chittagong Customs and issued a clarification. According to the new clarification, the import of limestone is subject to payment of 30 percent SD, he added.

However, he said limestone was only needed as two to three percent of the total ingredients in maximum cement.

Masud Khan, chief adviser to Crown Cement, said the government should be thinking about manufacturing industries rather than just trying to raise incomes.

“The sudden imposition of SD has hurt the cement industry.”

The country depends on imported limestone, which is used in various sectors as well as in the cement industry, he adds.

In a recent letter, the Bangladesh Cement Manufacturing Association (BCMA) demanded the removal of SD from cement raw materials.

“Chattogram Customs House has been collecting SD at a rate of 30% lately which has never been in place,” reads the letter, signed by the association’s first vice president Md Shahidullah.

Cement manufacturers import limestone under HS code 2521.00.10 paying 5.0% customs duty, 15% VAT, 3.0% withholding tax on income (AIT) and 3.0% d withholding tax for a long time.

The recent 30% SD imposition is burdensome for manufacturers as they suffer huge financial losses, the association said.

Cement industries use 10mm to 20mm limestone as raw material, which is a recognized size. “It is surprising that ‘Bulk Limestone’ is not considered as a raw material for the cement industries in recent times,” the letter reads.

The leaders of the association said that the cement industries are going through a critical period due to the excessive devaluation of the taka against the US dollar, the reluctance of banks to open a letter of credit in the event of a dollar crisis, increased inland transportation costs due to rising oil prices, etc.

This crisis was further aggravated after the imposition of the SD on the raw materials of the cement industries, they write in the letter.

According to one estimate, industry insiders found that using 11 kilogram limestone in 50 kg cement would cost an additional Tk 9.48 due to the imposition of SD.

They argue that the DD is generally imposed on luxury goods, non-essential items, and socially discouraging goods, not building materials.

[email protected]

. suddenly on limestone swells the costs many products

. Sudden limestone inflates costs products

PREV Man in critical condition after stabbing at gas station in southern Idaho
NEXT Wakanda Forever could be released on Disney Plus on January 20