SECOND PART

FISCAL MEASURES

Mr. Speaker, Sir,

I have already mentioned in the first part of my budget speech that I am presenting this national budget for the ninth occassion before this august parliament. Compared to the previous year, the present global situation has assumed all together a changed scenario. No sooner has the global economy started recovering from the debacle of the 11th September, it has been beset with an environment of animosity resulted from an undesirable war; killings here and there, frequent terrorist activities and unstable, hectic ambience all that vitiating atmosphere throughout the world today. As a result, economies of developing countries like ours are also getting influenced by those external events. This condition has been further aggravated by continuous recession in some strong economies of the developed world. The killer disease SARS has cropped up simultaneously, and in the opinion of experts, this disease has already started to affect the world economy adversely. In this perspective of the global disturbances, the task of preparing national budget of a country like ours has become more a complex exercise and a comparatively difficult process. We are left to depend more and more on our internal resources in the face of shrinking foreign assistance. In the circumstances, the measures that were adopted in the current budget can be treated as timely and meaningful. In this regard, I would like to quote some remarks as published in the Periodic Economic Update of the World Bank dated June, 2002 :

“The FY 03 budget aims to further broaden the revenue base to consolidate gains in fiscal sustainability. It also takes laudable steps towards a more liberal trade regime.”

In another part of this report, it has further been stated as such :

 “The revenue - GDP ratio is assumed to increase by 1.1 percent of GDP to 10.8 percent in FY03, reflecting a projected 20 percent growth in total revenues. The government has announced several tax and non-tax revenue measures, including strengthening of collection effort which will make a significant contribution to revenue growth; but achieving the target will require concerted effort from the beginning of the fiscal year.”

These remarks of the World Bank as quoted here proves how rational were the steps we adopted through various revenue measures while framing the current budget.

Mr. Speaker, Sir,

02.     Major reforms were introduced in the budget of the current fiscal year so that momentum could be achieved in boosting up productive activities of the whole economy for attaining the desired growth. It was also aimed at inproving collection of revenue. All-out efforts have been taken to go ahead with these reforms in the proposed budget of the next financial year. And in some cases, proposals have been put forward to make some adjustments in these reforms to improve upon the existing structure.

Mr. Speaker, Sir,

03.     We have been successful in bringing back order in many sector of the economy due to the bold steps that we have under taken from time to time. Some quarters, including some opposition political parties, tried to uphold the view that the target fixed for collection of revenue in the budget of the current fiscal year (2002-2003) was highly ambitious. Due to our efficient management of revenue collection we achieved great success. Insha Allah, in continuation of the process we pursued, we shall be able to meet the target as setforth. It is worth mentioning here that different international bodies including the World Bank (WB), the Asian Development Bank (ADB), and the International Monetary Fund (IMF) have made some observation about our revenue administration. In this regard, the Asian Development Bank has made the following comment in its December, 2002 issue of Quarterly Economic Update :

“Due to vigorous revenue mobilization effort, revenue collection during first six months of FY 2003 recorded an increase of 22.6% over the corresponding period of FY 2002 and exceeded the target set for the period by 1.8%. In the face of stagnancy in imports and a moderate pick up in domestic economic activity, the continuous surge in revenue collection since September, 2002 has raised optimism of exceeding the ambitious target for revenue collection set for FY 2003.”

The World Bank, in its January 2003 issue of Periodic Economic Update, has expressed similar opinion which runs as follows :

“This encouraging performance has been due to, among others, significant improvement in tax administration as well as growth in tax base due to economic recovery and some of the policy measures introduced in the FY03 Budget.”

The remarks as quoted above by these two coveted international organizations can be treated as neutral and positive and hence deserve our appreciation.

Mr. Speaker, Sir,

04.     In order to bring transparency in income tax administration, discretionary power of the assessing officers has been curtailed drastically, income of the NGOs from commercial activities have been brought under the tax net, and salary income of the government officials have been made taxable, and submission of statement with regard to the life-style has been made compulsory for taxpayers. Issuance of TIN in one working day has been ensured. All agricultural activities were given tax exemption up to 2005 to encourage agricultural productivity in the country. In the next year's budget a proposal has been made to extend this facility up to June 2006. Besides, special tax exemptions were provided for preservation of environment, for helping agro-based industry and medium and small industries. Tax facilities has been provided in the current budget for information technology also in order to ensure our effective participation in the globalization process. The highest rate of duty has been restructured from 37.5 percent to 32.5 percent and the second highest duty rate has been brought down from 25% to 22.5%, respectively. The rates of supplementary duty have also been restricted by limiting them in five slabs from thirty one slabs. Moreover supplementary duty has been withdrawn from hundreds of importables. Import license fee at 2.5 percent has been withdrawn from all types of imports. Many changes have been brought in Value Added Tax structure. Nine truncated base of VAT were brought down to three only. Evasion of tax has been monitored by appointing audit firms to accomplish the task of auditing. To achieve improvement in the modus operandi of tax administration continuous efforts were made. Taking into account all these measure we can hope to achieve the revenue targets by the end of June of this financial year, Insha Allah.

Mr. Speaker, Sir,

05.     The democratic Alliance Government believes in participatory approach to any reform measures. Upholding this principle and belief we have had several round of discussion with the FBCCI, the apex business body, as well as with various other business organizations, professional groups, renowned economists, educationists, Revenue Reform Commission, Journalists, senior citizen of the civic society representing different social strata. Discussion with many respected members of the parliament was held more than once on various aspects of the national budget. Different aspects of the budget have been discussed with the secretaries, and discussion on the budget took place in the cabinet meeting also. We tried to include in this year's budget most of the valuable suggestions received in course of such discussion.

Mr. Speaker, Sir,

06.     I have already mentioned in the beginning of my speech that the flow of foreign aid is shrinking day by day in the present situation the world over, and, as such, we have to give more emphasis on internal revenue mobilization, the main sources thereof being Custom Duty, VAT and Income tax. Custom duty at the import stage is still the largest source of internal revenue. But adherence to WTO principles may lead to shrinkage of revenue from this source in the near future. So, our dependence on Income tax and VAT is increasing day by day. That is why more emphasis has been laid on expansion of Income tax and VAT net in the budget.

Mr. Speaker, Sir,

07.     I am now placing important proposals relating to direct and indirect taxes before this august parliament.

DIRECT TAX

INCOME TAX

Mr. Speaker, Sir,

08.     For us income tax is the main source of direct taxes. The present democratic government has undertaken various reforms in tax administration. In the last budget significant changes were brought about in the tax laws to increase transparency and dynamism in tax administration, to reduce discretionary powers of tax officials, to expand tax base and to facilitate investment. The tax payers have started reaping the benefit of those measures. In this year's budget I am proposing measures which would consolidate and carry forward the measures taken last year. I am now placing before our august Parliament the major proposals with regard to income tax.

Mr. Speaker, Sir,

09.     At present, the tax exemption limit for individual tax payers is Tk. 75,000/-. Considering the cost of living, I propose to raise this threshold from Tk. 75,000/- to Tk. 90,000/-. This will reduce the tax burden of individual tax payers, particularly of the lower income group. The schedule of tax rate for individual tax payers is placed at Annexure- "A".

Mr. Speaker, Sir,

10.     The role of capital market in industrialisation of the country is very important. That is why it is very important to create momentum that will infuse new life to the capital market. Increasing the gap between tax rates of listed and non-listed companies is likely to encourage more companies to get listed with stock exchange. I, therefore, propose to recast the corporate tax rates in the following manner :

Tax rate for listed companies to remain unchanged at --- 30%

Tax rate for non-listed companies to be fixed at  ------- 37.5%

Tax rate for banks, insurance and financial institutions to be fixed at  ------------- 45%

However, if a listed company fails to declare at least 10% dividend or fails to distribute the declared dividend within the time limit specified by the Securities and Exchange Commission, it will pay tax at the rate of 37.5%.

Mr. Speaker, Sir,

11.     The present government has earmarked agriculture as the priority sector. The government has already taken various steps for the expansion of this sector. In the last budget income of agro-processing industries was allowed tax exemption upto June 30, 2005. Income from poultry, dairy, pisciculture, horticulture etc. is also exempted from tax upto June 30, 2005. In order to provide further encouragement to entrepreneurs in these areas, I propose to extend these exemptions upto June 30, 2006. I hope, this will boost economic activities in rural areas, generate employment opportunities and above all contribute significantly to economic growth.  

Mr. Speaker, Sir,

12.     The importance of readymade garments is immense in our export trade. For a long time the government has been extending various assistance to this sector. It may be mentioned that when I was in charge of the Ministry of Commerce I had given many facilities for development of the garments industry. During the tenure of the last B.N.P. government, as the then Finance Minister in 1993-94 fiscal year, I provided 25% cash subsidy for the export oriented garments industry. The facilities provided during that time greatly contributed to expansion of exports in this field in the following years.  But, in view of the changed situation in the international arena some of the exporters are already facing difficulty. By the year 2005, the facility of export quota will be withdrawn. It is feared that as a result of this withdrawal our exporters in this sector may face tougher competition than before. In view of the seriousness of the matter, I propose to reduce the corporate rate of income tax for readymade garments industries from 30% to 10% only for the period upto June 30, 2006.

Mr. Speaker, Sir,

13.     A sizeable number industrial enterprises have been set up in the textile sector in our country. New entrepreneurs are coming forward in different levels of the textile sector including spinning, weaving of fabrics, dyeing, printing and finishing. Efforts are being taken to quickly build up a backward linkage in textiles in order to assist the garments sector to expand and to stabilise its position in the export market. The government has already taken up various programmes for continuous development of the textile industry. The existing income tax rates for enterprises in this sector are 30% and 35%. Considering all aspects of this potential sector and in conformity with the facilities already extended to this sector, I propose to reduce the tax rate for the textile sector and fix it at 20% for the period upto June 30, 2006.      

Mr. Speaker, Sir,

14.     Due to wrong policies of the previous government our capital market had suffered a great set back in 1996. We have not yet fully recovered from that shock. The present government is making various efforts to revitalise the capital market and to make it more dynamic. As a part of these efforts I propose that investment in purchase of shares of a listed company during the period from 1st July, 2003 to 30th June, 2005 be accepted without explanation by the taxes department. However, if the shares are sold or transferred within two years of purchase, this facility will not be allowed.

Mr. Speaker, Sir,

15.     According to the existing tax laws, share holders are to pay tax on the dividend they receive. I think they would feel more encouraged to invest in the capital market if dividend is made tax-free in the hands of the share holders. I, therefore, propose to make dividend tax-free in the hands of the recipient. Simultaneously, I propose to impose dividend distribution tax at the rate of 10% on the companies declaring dividend.

Mr. Speaker, Sir,

16.     The system of self-assessment is now available for individual tax payers. In the year 1999 the system was amended in such a manner that it paved the way for gross abuse of the system. Some tax payers took advantage of this situation. They submitted self-assessment returns showing income at an amount much less than their real income and totally inconsistent with their style of living. The present government took various steps in the last budget to make the self-assessment system realistic and to reduce scope of tax evasion. In continuation to those measures I am suggesting a few more changes to this system. I propose that businessmen and professionals will pay a minimum tax of Tk. 12,000/- and directors of companies will pay a minimum tax of Tk. 30,000/- in order to make their returns acceptable under the self-assessment scheme. Otherwise their returns will be assessed following normal assessment procedures.

Mr. Speaker, Sir,

17.     Expansion of tax base is absolutely necessary for increasing tax collection. The present democratic government wishes to increase revenue earnings by expanding the tax base instead of putting new tax burden on the tax payers. Provisions for compulsory submission of tax returns in certain cases already exist in our tax laws. In addition to those, I propose to make submission of tax returns compulsory in the following cases :

(a) in case of every business establishment having a trade license issued by a city corporation, municipality or union council and having a bank account;

(b) in case of all professionals including doctors, dentists, lawyers, chartered accountants, cost and management accountants, engineers and architects who have received practising license from recognised professional bodies;

(c)      in case of all members of chambers of commerce and industries and trade associations;

(d)      in case of every person contesting in the elections to National Assembly, City-corporation, Pourashava or Union Council;

(e)      Anybody contesting in a tender floated by a government organisation, semi-government or autonomous organisation or a local authority for supply of goods or execution of contract;

Persons for whom submission of income tax return is made compulsory will have to submit their tax returns within the time specified under section 75 of the Income Tax Ordinance. In case of failure to submit return in time, appropriate action will be taken as per law.

Mr. Speaker, Sir,

18.     Since last January taxes department is conducting a nation wide survey under the supervision of National Board of Revenue to expand the tax base and increase the number of taxpayers. Such large scale survey work was not undertaken before. As a result of this survey eighty thousand new tax payers have already been identified. This number is expected to rise upto one lakh by the end of this month. The survey will be going on as a continuous process and during the fiscal year 2003-2004, I hope, it will be possible to identify another few lakhs of new taxpayers through this survey.

Mr. Speaker, Sir,

19.     Effective monitoring of 'deduction of tax at source' is very important. Therefore, for the purpose of monitoring and auditing 'deduction of tax at source' by the income tax department I propose to give the National Board of Revenue necessary legal powers.

Mr. Speaker, Sir,

20.     Some commercial enterprises and industries of the country are enjoying tax exemption for an indefinite period. Profit making business enterprises run by some welfare organisations and welfare trusts are also enjoying these exemptions. But other enterprises engaged in similar business activity and producing similar goods are paying taxes normally. Consequently, there is an unequal competition between the enterprises which pay tax and those which do not. This is inconsistent with an equitable tax policy and competitive market mechanism. I, therefore, propose to withdraw the tax exemption given to all these commercially run enterprises.

Mr. Speaker, Sir,

21.     The facility of making provision for bad and doubtful debts was allowed to banks in the year 1990-91. Following the latest amendments made in 1997, banks are allowed to make provision for bad and doubtful debts at the rate of 3% of the total outstanding loans. But there is no reason to let this provision continue indefinitely. In fact, this provision should be withdrawn gradually. As the first step in this direction, I propose to reduce this rate from 3% to 2%.

Mr. Speaker, Sir,

22.     In order to encourage establishment of industries our tax laws provide for tax holiday. According to existing provisions, an industrial undertaking having any financial or commercial transaction with an associate enterprise is not considered eligible for tax holiday. This provision was introduced with a view to checking evasion of tax through internal transfer pricing between sister concerns. But it is felt that in some cases there are genuine needs for commercial and financial transactions to take place between associate enterprises. I, therefore, propose to withdraw this restrictive provision in case of normal commercial or financial transactions between associate enterprises. I also propose that if any enterprise indulges in abnormal transactions to take place with an associate enterprise with the intention of evading tax, the concerned enterprise will be considered ineligible for tax holiday.

Mr. Speaker, Sir,

23.     In a developing country like ours collection of direct tax, particularly income tax is a difficult task. At times, correct application of tax laws becomes a complicated and time consuming affair. The knowledge and experience of audit firms, cost and management accountant firms, law firms, engineering firms and survey and valuation firms can effectively supplement the efforts of income tax officials in collection of revenue. I, therefore, propose to give National Board of Revenue necessary legal authority to employ these professional firms through outsourcing and use them for any job that the Board may deem fit and proper.

Mr. Speaker, Sir,

24.     At present pension income of residents is tax exempt. But pension income of non-residents is not tax free. According to existing laws anybody staying outside the country for more than 182 days in a year becomes a non-resident. It is not reasonable that the pension income of a person should be made taxable just because he stays outside the country for more than 182 days. In order to remove this anomaly, I propose to make pension income of a person tax free regardless of whether he is a resident or a non-resident.

Mr. Speaker, Sir,

25.     Along with legal reforms, the government has also taken initiatives to increase efficiency in tax administration and to enhance the working capacity of the taxes department. To this end, the Reforms in Revenue Administration (RIRA) project is already underway. Through this project, steps are being taken to thoroughly reorganize the Large Taxpayer Unit (LTU) and to modernize the taxes department. Besides, a plan has been drawn up to establish a Central Intelligence, Monitoring and Audit Cell at the National Board of Revenue. This cell will gather significant data relating to taxes and analyse them. It will also establish a regular exchange of information among income tax, customs and VAT. I hope, the measures proposed in this budget will be helpful in expanding the tax base, increasing efficiency of the taxes department and checking tax evasion to a large extent which will eventually help us in achieving the revenue target.

INDIRECT TAX

IMPORT DUTY

Mr. Speaker, Sir,

26.     In the current 2002-2003 year budget and during post budget period whatever measure that were adopted reflected the government's declared policy to protect interest of the common people. Of particular importance is the fact that there has been extensive reduction of duties and taxes on daily necessities like rice, lentils, vegetable oil, etc. I wish to cite example of the extent of tax incidence on import which are applicable to some of the items of daily necessities :

(i)       Rice features on top of list among the food items in comparison to the other food cereals. During the last regime tax incidence on rice was 43%. The present government had reduced the same to 7.5%;

(ii)      Pulses is one of the important food item for the poor mass upon which the tax incidence during the last regime was 13%. We have brought it down to 7.5%;

(iii)     The requirement of the lion share of edible oil need of the common people is met by imported soya bean oil and plam oil. The tax incidence on crude soya-bean and palm oil during 2001-2002 was 40.25%. The present democratic government had reduced the tax incidence to 23.63%. At the same time in order to halt the upward trend of price of edible oil except Advanced Income Tax all other taxes were completely withdrawn from the imported oil seeds (like mustard seed, sunflower seed & rape seed). Important to mention that the total tax incidence on the said oil seed previously was 13%. Due to the above mentioned action which was taken oil seeds worth Tk. 246/- crore were imported. While using imported oil seeds edible oil is manufactured on the one hand oil cake is extracted on the other which in the process supplement as poultry, fish and dairy feed.

(iv)     Despite these measures due to the continuation of price hike of edible oil the tax incidence on refined soya bean oil had to be reduced from 66.13% to 23.63% in order to maintain unhindered supply of the same in the market;

(v)      Keeping harmony with the above measures I propose to reduce tax incidence on the following two daily nessecities:

(a) As the customs duty rate on refined soya been oil and refined palm oil used to be the same I propose to reduce the custom duty on refined palm oil and set the tax incidence at 23.63%. This will remove the existng tax anomaly between the refined soya bean and refined palm oil. This measure will ensure abundent supply of edible oil in the market.

(b) I also propose to reduce the tax incidence on wheat to only 7.5% withdrawing advance income tax and IDSC on the items.

Mr. Speaker, Sir,

27.     During the time of previous government at import stage customs duty, supplementary duty, value added tax, advance income tax, infrastructure development surcharge, licence fee etc. was applicable. Our present government in the last budget had withdrawn completely the 2.5% licence fee. I had declared at that time that the same trend in future will continue. Following the same spirit I propose to withdraw AIT in the next budget completely on 175 importables keeping in mind to withdraw AIT in stages in future.

Mr. Speaker, Sir,

28.     Infrastructure development is very important towards achieving growth. Due to increase in expenditure to develop the infrastructure there is a mounting pressure on internal resources to meet such expenditure. As a result expenditure on account of infrastructure development in the budget is increasing enormously. Considering this I propose to increase the existing IDSC rate by only 0.5%

29.     While announcing the budget for 2002-2003, I declared that during 2003-2004 financial year attempt will be made to restructure import duty rate at 10%, 20% & 30%. According to that announcement if the lowest rate of custom duty of 7.5% is raised to 10% then a total of Tk. 250 crore approximately could be collected as additional revenue in the coming year. Instead of attaching importance to revenue collection I am proposing to continue with the lowest rate of customs duty at 7.5% this year  considering the need for protecting local industry.

I am also proposing to maintain the existing 'zero' rate of custom duty on agriculture, fisheries, poultry, dairy, life saving drugs and allied instrument/equipment. The existing duty rate on intermediate goods and semi finished goods will as far as possible be maintained.

However according to the earlier commitment I am proposing to lower the highest rate of customs duty from 32.5% to 30%. Revenue loss on this account will be Tk. 210 crore approximately. Our neighbours following the trade liberalisation policy of under WTO have meanwhile lowered their highest rates of custom duty to 25%. In near future Bangladesh will have to follow suit and further reduce the highest duty rate.

Mr. Speaker, Sir,

30.     Earlier in my speech it was mentioned that the previous government had imposed supplementary duty having thirty one slabs (ranging from 2.5% to 270%) on hundreds of items. This was totally restructured during the present financial year at only 5 rates (10%, 20%, 30%, 50%, 60%) by the present government. Continuing with the same trend of reform I am further proposing to restructure the rates at 15%, 25%, 40%, 50% and 75%. This will go to help protect local industry and to help curb import of luxury and comparatively unnecessary importables.

31.     During the current budget period as necessity emerged from time to time duty rates on few importables were reduced and in some cases it was rationalised by imposing regulatory duty. With some adjustment I am proposing to continue the same duty rate on those items (Annex-B).

Mr. Speaker, Sir,

32.     The present government has laid stress upon attaining growth in agricultural sector and at the same time has been extending extensive assistance to fisheries, poultry, dairy, horticulture and in the like fields. The existing customs duty on agricultural equipment, irrigation pump, fertilizer, poultry equipment including few other item is zero. But fish 'pona', breeding animal, poultry parent stock, seeds and on certain types of fertilizer AIT & IDSC together being 6.5% is applicable at import stage. In order to give support to such agriculture related sector, I am proposing to withdraw this AIT & IDSC completely besides maintaining the existing 'zero' customs duty. As a result it is hoped growth potential will be augmented in these agriculture related sectors.

33.     Clean and safe water is an important pre-requisite towards keeping good health. Thus I propose to lower the custom duty on water filter (domestic type) like industrial water treatment plant from 22.5% to 7.5%. This measure, it is hoped will partly go to meet the demand for safe drinking water at a fair price.

34.     At present custom duty on various types of pumps which is leviable is 0%, 7.5%, 15% and 22.5%. Because of prevalence of more than one rate, scope of misdeclearation has been created. Considering this aspect I am proposing to fix customs duty rate at 7.5% on all types of pump except in certain cases (irrigation pumps & hand pumps). In case of irrigation pump the existing 'zero' rate will continue.

Mr. Speaker, Sir,

35.     The duties & tax rate on raw materials which are used in various local industries I seems to be reasonable. If the existing duty rate on the basic raw materials used in industries like linseed oil, tung oil, dolomite, blended powder/flux, grinding ball and nickel coated copper wire (a raw material of spectacle frame) is reduced somewhat this will help grow such industries. As such I propose to lower the existing rates of custom duty on the above goods to the next lower stage. I propose further to withdraw the existing 20% supplementary duty on aluminum or iron base cap for filament lamp, (Annex-'C') in the interest of the relevant industries.

Mr. Speaker, Sir,

36.     Good quality copper wire & aluminum wire is being manufactured in Bangladesh. At the same time the glass bottle and jar manufacturers are capable of meeting the local needs. If some assistance is given to them then expansion in these industries may occur. Therefore I propose to increase the existing customs duty on these items to a slab higher than the existing one (Annex-'C').

Mr. Speaker, Sir,

37.     Sugar has a wider demmand as an essential consumer goods as it is also used extensively in food, beverage and pharmaceutical industry. With the present leviable duty of 32.5% the total incidence of taxes is 89.35% on import of sugar. Despite prevalence of such high duty rates the sugar manufactured locally is losing market and not in a position to compete with the imported sugar. To give necessary protection to local sugar industry I propose to impose 40% supplementary instead of existing 20%.

38.     At the moment particle board, plywood and carpet of international quality is being manufactured within the country along with assembling of refrigerator and colour television. In order to discourage import of these items in CBU condition I propose to impose 15% supplementary duty on these goods. At the same time I also propose to increase the existing rate of supplementary duty on glass sheet from 30% to 40% and impose 40% supplementary duty on glass mirror at import stage (Annex-"C").

Mr. Speaker, Sir,

39.     In many of the cities and villages in the country expansion of gas connection has not been made possible even though gas supply has reached only a few urban areas. The Ministry of Oil Gas and Mineral Resources has informed that due to higher costs of supply of raw materials used in supply of LP Gas it has not been possible to supply LP Gas at a low price. Considering this aspect I am proposing to withdraw Value Added Tax at import stage on import of gas cylinder, regulator, valve & hose pipe. At the same time a reduction of customs duty from 32.5% to 15% on hose pipe used with gas cylinder is also proposed. This measure it is hoped will help bring down the price of LP gas to acceptable level. I also propose to reduce the existing rates of supplementary duty on petroleum oil from 30% & 20% to 25% & 15% respectively. However reduction of highest customs duty rate by 2.5% along with reduced supplementary duty as proposed the tax incidence in this case will come down by 11%.

40.     In a modern city the services rendered by Taxi Cab network is of immense benefit. The previous government had withdrawn the the concessional rate of duty on import of reconditioned taxi cabs. As a result only new vehicle imported as taxi cab was enjoying this duty facility so long. I am proposing to extend the concessionary duty rate facility on fulfillment of all prevailing condition to three years old  reconditioned vehicle. However as there is no supplementary duty on taxi cab I propose to increase customs duty to 15% from 7.5%. This concessional duty rate facility will extend to both reconditioned and new vehicles which are above 1300 cc only.

Mr. Speaker, Sir,

41.     There is ample production of mango, jackfruit, banana, papaya, berries, lichies, pineapple, melon and guava in our country. Even then various types of fruits are imported spending a huge foreign exchange. I therefore propose to increase supplementary duty from 30% to 40% on import of various types of fruits. In the same manner I propose to impose 25% supplementary duty on import of spices like cardamom, 'daruchini', cloves, 'jeera', black pepper which are consumed by comparatively the well to do class.

42.     The Ministry of Forest and Environment has informed that use of CFC-12 gas in refrigerator and air conditioner is very harmful to environment. At the moment there is 15% customs duty. It is not perhaps appropriate to have such low rate customs duty on product, which is harmful to environment. Considering this I propose to impose 22.5% customs duty on this item and at the same time also propose reduction of customs duty to 7.5% from 15% on environment friendly HFC-134a gas.

Mr. Speaker, Sir,

43.     In the current budget specific duty was introduced on mobile phone which has resulted in payment of duties and taxes at a lower rate on mobile set which are of higher value. In order to redress this situation I propose to impose specific duty at Tk. 3,000/- for a mobile set upto value of Tk. 10,000/- (CIF value) and Tk. 4,000/- for those which are above Tk. 10,000/- (CIF value).

 44.    Successful bypass surgery including treatment of heart disease are now available within the country. In order to reduce the expenditure on account of treatment of these diseases, I propose to withdraw all existing duties and taxes on angiographic catheter wire, sheath, guide catheter wire, balloons, stents In the same manner I also propose to withdraw all duties and taxes which are leviable upon a large number of equipment and machinery used in medical treatment like kidney dialyses machine, oxygen therapy, incubator, invalid chair watches for blind, artificial joints, hearing aids, heart valve pacemaker and the like goods. However the lowest rate of duty 7.5% on various types of medical equipment will continue.

Mr. Speaker, Sir,

45.     In the current financial year in order to make new motor  vehicle available comparatively at a resonable  price the tax incidence on new vehicle was lowered remarkably. Since I have proposed to lower highest rate of customs duty by 2.5% and restructure supplementary duty rate in this case I therefore propose to impose supplementary duty on verious types of motor vehicles at the following rates:

Description of motor vehicle

Proposed rate supplementary duty

a) Cylinder Capacity up to 1649 C.C.

15%

b) Cylinder Capacity from 1650 to 3000 C.C.

40%

c) Cylinder Capacity above 3000 C.C.

75%

Mr. Speaker, Sir,

46.     During the last financial year in order to develop and speed up the growth of textile sector quite a few steps were undertaken which has positively led this sector to become competitive gradually. In order to maintain the same level of assistance given by the government this year I propose to reduce customs duty on quite a number of textile raw materials and finishing agents (Annex-"C"). Despite possibility of reduction in revenue collection due to this measure it is hoped that the textile enterprenure will be able to reap benefit out of this measure.

Mr. Speaker, Sir,

47.     With a view to prevent misuse of bonded warehouse facilities and evasion of taxes, I placed certain specific proposals in this august parliament last time. The Revenue Reforms Commission, in their interim report, has also presented following recommendation in this regard :

"…The best way to secure the revenue is to obtain a bank guarantee ensuring realization of import taxes. Many countries do it. The same may be introduced. Under this scheme all bonders other then garments exporters will furnish an unconditional bank guarantee covering the duty and taxes of the entire quantity of the goods each time duty free clearance is effected. …"

In compliance with the proposals of the last year's budget and on the recommendations of the Revenue Reforms Commission a number of effective steps have already been taken in this regard. Now, I propose certain steps to be taken in the forthcoming fiscal year :-

(i)       Many industries have already been set up in the country which manufacture raw-materials for export-oriented industries. To protect the interest of those types of industries, policy may be undertaken to stop, as far as possible, import of raw-materials under bond which are being produced in the country;

(ii)      Bonded warehouse facilities may be kept restricted for some particular industrial sectors including hundred percent export-oriented industries;

(iii)     Yearly import-entitlement may be given in order to prevent misuse of facilities through irregular sale in the open market;

(iv)     The bonding-period of warehoused goods may be made determined;

(v)      Keeping in view of the objectives cited above, I propose to amend the provisions of section-13 & section-98 of the Customs Act, 1969;

(vi)     Recently a provision has been made in case of some irregularity-prone deemed-export sectors to submit bank guarantee covering the whole amount of duty & taxes applicable to the imported raw materials at the customs clearance stage. This provision is going to take effect from 1st July, 2003. Pointing at the recent global economic recession, many entrepreneurs of those sectors have meanwhile appealed for relaxation of this  provision. In totality considering the recommendations of the Revenue Commission I propose that for the time being a new provision may be introduced under which irregularity-prone deemed export sectors shall submit bank guarantee covering only 25% (one fourth) of the duty & taxes applicable at import stage.

48.     Our entrepreneurs in order to market their goods in the local  market often request for tariff protection against imported competing goods. In this regard many foreign entrepreneurs including those from the neighbouring countries take effective action to impose antidumping duty (AD) and countervailing duty (CVD) on foreign goods. Our entrepreneurs will have to initiate appropriate action to impose AD and CVD with the help of Bangladesh Tariff Commission. I will hope that our businessmen and the entrepreneurs henceforth will explore such avenues in order to protect their indusries.

49.     In order to make the existing Customs Act, 1969 more transparent and suiting to the occasion and with a view to introducing effectiveness in custom administration I propose to bring certain amendment and changes in the said Act.

50.     With a view to harmonise various relevant issues relating to the scope, definition etc I propose to amend the Privileged Persons (Baggage) Rules, 1985 by a new Privileged Persons (Customs Procedures) Rules 2003 keeping the core theme in the previous Rule intact. At the same time I propose to bring certain amendments in the Passengers (Non-Tourist) Baggage (Import) Rules 2000 to help the air passenger to clear customs formalities quickly and comfortably.

51.     Remarkable progress has been achieved in upliftment of organizational-skill of the customs administration and also in  making the export cargo assessment process faster and transparent. This has been made possible with the aid of the National Board of Revenue's ongoing Customs Administration Modernization (CAM-1) Project. ASYCUDA++ (Automated systems for Customs Data) has been implemented at Dhaka & Chittagong Custom houses and also at ICD, Kamlapur. Besides DTI (Direct Traders Inpot), in a limited scale, has been introduced at Custom House, Chittagong and at ICD, Kamlapur. Introduction of 'Close Loop' and DTI under ASYCUDA++  system  has made the process of assessment  and clearance of cargo faster which will play an important role in the expansion of trade, business and industry of our country.

Mr. Speaker, Sir,

52.     Our lion share of duties and taxes is collected through Custom House Chittagong. We have to pay a serious attention to explore how best this huge revenue collection can be ensured. I therefore propose to create two seperate custom houses there instead of the existing one and also for making provision for manpower and logistics.

53.     At present through some of the land routs expansion of trade has taken place. Due to in adequate infrastruture the assessment procedure is badly affected. I propose to elevate the status of these Circle offices at Sona Masjid, Hili, Burimari, Tamabil and Teknaf to the level of Divisional Office. At the same time I also propose to increase the necessary manpower of Internal Container Depot (ICD), Dhaka, Benapol Customs House and Sylhet Commissionerate.

 

VALUE ADDED TAX AND

SUPPLEMENTARY DUTY

Mr. Speaker, Sir,

54.     BNP Government introduced the Value Added Tax or VAT system in the country in 1991 in order to maximize the mobilization of internal resources and to increase contribution of domestic resources towards funding the development programme. In the current budget Government has undertaken many steps to improve upon the existing VAT system. With this aim in view exemption of VAT was allowed on many items particularly related to Agriculture. Some of these exempted items are Power tiller and tractor used in agriculture, aerator used in pisciculture, full fat soyabean used in fish feed and animal feed, electricity used in irrigation, locally produced molasses of sugercane and sugar, and in areas like land development, purchase & sale of land and apartments etc. Moreover, supplementary duties were exempted from all domestic products except Cigarette, Natural gas, Cosmetics, Marble slab, Tiles, Ceramic products, Bathroom fittings and Milk powder. Keeping harmony with the declared strategy now I am placing some proposals on the Value Added Tax before this august Parliament.

Mr. Speaker, Sir,

55.     As you know, Agriculture sector is playing a vital role in the economic development of our country. Keeping this in mind, present government is patronizing the agriculture sector in all possible ways.

56.     I believe full Exemption of VAT on locally produced and packed rice, pulses, wheat, maize, gurlic, onion, chille, ginger, corriander seed, vegetables, fresh fish and meat will help this sector to flourish. I am, therefore, proposing exemptions of VAT on all these locally produced packed items.

Mr. Speaker, Sir,

57.     In order to further extend assistance to agricultural sector, I am proposing withdrawal of VAT on Gypsum di-hydrate used as fertilizer and on pesticides for killing rats in the grain field.

58.     At present bulk importation of gas are enjoying VAT exemption. The enterprises bottling LP gas produced locally are paying VAT on bulk purchase. To remove the discrepancy and to create a level playing field I am proposing exemption of VAT on bulk purchase by the enterprises bottling the same.

59.     Travel agency has a significant role in the development of the tourism industry of the country. With a view to promote tourism and to increase foreign exchange earnings, I am proposing withdrawal of VAT on this sector.

Mr. Speaker, Sir,

60.     Presently VAT is leviable on all categories of advertisement published in the Newspaper. But small types of advertisements like “birthday”, “chehlum”, “tutor wanted” and lost notice etc. are also published in the newspaper. Considering the problems of these categories of advertiser (most of them are common people and students), I am proposing withdrawal of VAT on these types of classified advertisements published in the newspapers.

61.     Local manufacture of toiletries & cosmetic like Shampoo and Skincare Cream are facing uneven competition with the importers of the same as they are paying supplementary duty at the rate of 20% advalorem. I therefore, propose reduction of supplementary duty on Shampoo and Skincare cream products from 20% to 10%.

Mr. Speaker, Sir,

62.     In the present budget minimum VAT leviable on small shops of the city corporation areas are fixed at Tk. 4200, and outside the city corporation areas Tk 3000. To reduce the burden on the small shops located outside the city corporation and the district town areas, I propose to fix it at Tk. 2000 only. But large traders including importers, dealers, distributors commission agents, MS products and Cement traders will continue to pay VAT on the basis of their actual sales.

63.     At present VAT is payable on furniture at the rate of net 4.5% at factory level. Again, at the time of selling of the same from the show room and sales centres another net 4.5% VAT is payable. In order to lessen the burden, I am proposing to reduce VAT from net 4.5% to net 1.5% at the show room & sales centre level. This will help domestic furniture industry to flourish. At the same time I propose to reduce net VAT on ready made garments sales center from net 2.25% to net 1.5%.

Mr. Speaker, Sir,

64.     VAT is leviable on Decorators, Caterers and Sweetmeat shop within the metropolitan and the district town areas since its inception. But the same traders outside these areas are exempted. As such, I am proposing withdrawal of this exemption to remove this anomaly.

65.     Withdrawing exemption partially on tailoring shop, I am proposing to impose VAT on only air-conditioned tailoring shops. I further propose to withdraw VAT exemption on money exchange business and on use of credit card.

66.     Cottage industry is exempted from payment of VAT from the very beginning. On the other hand, enterprises producing the same products are paying VAT and facing uneven competition in the market. To remove this uneven competition, I am proposing to withdraw cottage industry benefit from medicine, biscuits, logens, laundry soap and mineral water.

Mr. Speaker, Sir,

67.     There is enough potential to realize huge amount of VAT from the locally produced soft drinks, soap, detergent powder and mineral water. But due to evasion of duty by some unscrupulous manufacturers of those items, govt. is being deprived of huge amount of revenue. On the other hand the enterprises, that are paying VAT properly are facing uneven competition. To encourage honest and sincere taxpayers, to prevent evasion and remove uneven competition, I propose to introduce VAT Stamp (like cigarette banderole & stamp) on these items from October 2003.

Mr. Speaker, Sir,

68.     Handmade cigarette or (bidi) is a major source of local revenue. But this item is still within the purview of the Excise law. In order to streamline and ensure proper collection of revenue from this sector I am proposing to bring it under VAT net. But present banderole system and the tax incidence on a packet of 25 sticks will remain unchanged.

69.     At present the leaseholder and the procurement provider are subject to payment of VAT. Keeping in view of the same principle, I am proposing to impose VAT on all items sold in auction by the government, semi-government and autonomous body, Bank, Insurance and other limited companies at the rate of net 1.5% of the auction value.

Mr. Speaker, Sir,

70.     You are aware that we have been reducing the rate of customs duties and other taxes every year at the import stage due to changed circumstances. The importance of VAT is increasing as an important source of internal revenue. In the mean time, the network of VAT has been expanded all over the country. But with the present organizational structure, we are facing difficulty in managing VAT Administration.

71.     To improve upon this situation, I am proposing to establish two new VAT Commissionerates at Dhaka, one new VAT Commissionerates at Chittagong, 16 new Divisional Offices and 52 new Circle Offices all over the country and increase required number of manpower and logistics with effect from January 2004.

Mr. Speaker, Sir,

72.     VAT is an account and audit based transparent taxation system. So with a view to strengthen the activities of the Directorate of Inspection I am proposing to rename it as Directorate of VAT: Audit, Intelligence and Inspection and to increase required number of manpower.

Mr. Speaker, Sir,

73.     Since there is no time limit in the VAT law to issue VAT registration certificate after submission of the application, in some cases the issuance of such certificate is inordinately delayed. Complaints of such delay is not very uncommon, so, for the purpose of quick issuance of VAT registration certificate, I am proposing to make provision in the law to issue the registration certificate within two working days. Inquiry and other related works may be done afterwards. Moreover, considering the demand of different organizations, I am proposing to make required amendments in VAT rules, so that in near future in place of manual up keeping of Registers and documents, the same can be done through computers.

74.     I am proposing to make necessary amendments in the VAT Act and Rules to make it simple and at the same time effective.

Mr. Speaker, Sir,

I would now place some proposals on Other Taxes and Fees :

75.       Travel Tax : A sizeable portion of  direct tax is usually collected from travel tax. It has been provided in the law that every airlines will collect air travel tax from passengers at the time of selling tickets and will deposit the same to the national exchequer within a stipulated time.  But it is experienced that  some airlines are not depositing collected tax on different pleas for moths together.

In order to streamline the irregularities in this case, I propose necessary amendments in Travel Tax Act, 2003 .

76.     Television Fees : License fee on television has to be paid on yearly basis as per the existing rules. But the owner of TV sets does not pay fee on yearly basis regularly. Some times they are in the habit of paying such fees only at the time of purchasing such sets. As a result, government is being deprived of its due revenue. To improve upon this situation, I propose that the purchaser of TV sets henceforth shall pay TV license fee for three years at a time while purchasing TV. This will help them getting rid of difficulties in paying such fees every year.

Along with this, I propose to withdraw fee on all kinds of radio sets since these are commonly used by low income group.

77.     Motor Vehicle Registration Fee: Motor vehicle taxes and fees are imposed on different kinds of vehicle to provide funds for maintenance of roads, bridges etc. and in this regard registration fees are also collected for the same purpose. Experience shows that collection of registration fee is not up to the mark and in most cases, evasion takes place. In the circumstances, I propose that legal provisions be made for collection of registration fee at import stage for all kinds of motor cycle, three-wheeler and motor vehicle to streamline revenue earnings from this source.

Mr. Speaker, Sir,

78.     So far I have deliberated on the main tax proposals for 2003-2004 financial year. Now I intend to present in brief the salient features of the revenue targets. In the current budget the total revenue target  to be achieved by NBR was fixed at TK. 23,750 crore and the main sources of revenue are Customs Duty, Income Tax, VAT and Other Taxes. For the coming financial year 2003-2004, the target fixed for NBR revenue is estimated at TK. 27,750 crore. The growth we have envisaged in revenue collection in 2003-2004 financial year will be around 16.84% over the current year. Break up in detail of revenue target is placed at Annexure-"D".

Mr. Speaker, Sir,

79.     It is the firm commitment of our government to realize the dream of our Great leader Shaheed President Ziaur Rahman to build a happy and prosperous Bangladesh. To attain this goal we shall have to strengthen the hands of our Hon'ble Prime Minister Begum Khaleda Zia. A major part of the duration of our government spent so far was utilized to reorganize, streamline and rebuild the devastated economy left behind by the past government. Under the bold and far-sighted leadership of our Honourable Prime Minister, the reforms that were undertaken by this alliance government have so far given us the desired result. All the measures we have taken so far has already started to yield encouraging results toward the welfare of our people. The co-chairman of recently concluded Bangladesh  Development  Forum and the Vice President of South Asia region of the World Bank Ms. Mieko Nishimizu was in full praise of our Hon'ble Prime Minister Begum Khaleda Zia, for adopting various reforms to improve the living conditions of our people. She also praised Hon'ble Prime Minister for her sincere commitment and dedication to quicken the pace of development stating "Under the leadership of the Honourable Prime Minister, a silent revolution is taking place in the development efforts of Bangladesh."

Mr. Speaker, Sir,

80.     We have to be a hard task master to carry forward further the development programmes. That road is not so rosy. Mobilization of internal and external resources, appropriate allocation of the same and proper utilization of these resources if can not be ensured, the pace of development will come to a halt. As a result, we shall not be able to reach the desired destination on time. Specially in every sphere of our national life, establishment of  good-governance has become all the more necessary. To that end we shall have to go for more reform based programme.

Mr. Speaker, Sir,

81.     While placing the current year budget I referred to many important issues. The economic gains and welfare considerations were given utmost priority in my dealings with the subject of economic development of our country. I gave lot of emphasis on our united efforts to foster and cajole economic growth of the country. I want to repeat the same this time also and stress upon the point that if we want to survive as a successful nation we shall have to go ahead with well planned programme in all sphere of our national life. In order to implement the development programmes, which will be taken up for the welfare of the country and our people, co-operation and concerted efforts of all irrespective of party and politics must be ensured. Our main goal is to redress the sufferings of the down-trodden people in our society by eradicating poverty within the shortest possible time. At the same time to fulfil the basic needs of our people we are to act with devotion and sincerity. In our national life we shall have to harbour the habit of sacrifice and if we can inculcate this habit, small selfish considerations can not influence us. And then the country, more truly, the interest of the people of our country, will get priority in all our thoughts and endeavors. Let us resolve to perform this hard task of nation building working unitedly to achieve a happy and prosperous Bangladesh. Let Almighty Allah help us in our mission.

Allah Hafez

Bangladesh Zindabad.



Annexure-"A"

Income tax rate for individual tax payers

Sl no.

Proposed Slab

Propose rate

1.

On  first Tk. 90,000/- of  total income

Nil.

2.

On next  Tk. 1,50,000/- of total income

10%

3.

On next  Tk. 1,50,000/- of total income

15%

4.

On next  Tk. 2,50,000/- of total income

20%

5.

On the balance of total income

25%

             

Annexure-"B"

  Summery of revision of revenue measures

taken since July, 2002 :

Sl. No.

Description of Goods

Customs Duty

Supple. duty

Regulatory Duty

IDSC

Budget

Present

Budget

Present

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

01.

Crude soyabean oil

22.5%

7.5%

     

0%

02.

Crude palm oil

22.5%

7.5%

     

0%

03.

Passenger Vehicle Having a seating capacity from 10 to 15 seats

32.5%

22.5%

       

04.

Minibus

32.5%

22.5%

       

05.

CKD Passenger Vehicle

15%

7.5%

       

06.

Bus

15%

7.5%

       

07.

CKD Refrigerator & Freezer

22.5%

15%

       

08.

Perforated Stainless Steel Blades Strip

32.5%

15%

       

09.

Electric generating sets

7.5%

0%

       

10.

Granite, Travertine, Alabaster & Marble Stone

   

0%

20%

   

11.

Fluorescent, Hot Cathod (Tube Light)

   

50%

30%

   

12.

Reconditioned Motor Car : Cylinder Capacity 1350 to 1649

   

0%

10%

   

13.

Cinnamon

   

50%

0%

   

14.

Cloves

   

30%

0%

   

15.

Cardamoms

   

50%

0%

   

16.

Seeds of Cumin

   

50%

0%

   

17.

Turmaric

   

10%

0%

   

18.

Fibre Board of Wood or Other Ligneous Mateirals

   

0%

10%

   

19.

Emery Cloth

   

0%

20%

   

20.

Desogestrel ethinyloestradiol and lynestrenal (Contraceptive Raw Materials)

7.5%

0%

       

21.

Mustard Seeds, Sunflower Seeds, Rape or colza seeds

7.5%

0%

     

0%

22.

Polypropylene

22.5%

15%

       

23.

Refined soya bean oil

32.5%

7.5%

     

0%

24.

Rice

22.5%

7.5%

     

0%

25.

Refined sunflower oil

32.5%

7.5%

     

0%

26.

Refined corn oil

32.5%

7.5%

     

0%

27.

Lubricating oil

         

0%

28.

Propane, Butane

         

0%

29.

Lentils

         

0%

30.

Maize (Corn) Starch

         

0%

31.

Vat Dyes, Reactive Dyes, Pigments & Brightening Agent

         

0%

32.

Dobbies, jacquards and Shuttles (Textile Spares)

         

0%

33.

Polyester Yarn

       

5%

 

34.

Biscuits, Waffles & Wafers

       

30%

 

35.

Soap Noodles

       

5%

 

36.

Cotton Shirt, T-Shirt, Trouser, Bed Linen

       

30%

 

37.

C.I Sheet

       

10%

 

38.

Carbon Rod

       

10%

 

39.

Bicycle (not motorised)

       

30%

 

40.

Toys & Dolls

       

30%

 

41.

Color & B/W Television (CBU)

       

10%

 

42.

Zinc Callot

       

7.5%

 

43.

Pre-Fabricated Building

       

7.5%

 

44.

Slag Sand from the manufactured of Iron or Steel

       

15%

 

45.

Fly Ash

       

7.5%

 

Annexure-"C"

Summery of Proposals in respect of Customs

in respect of Customs Duty for Fy 2003-2004 :

Sl. No.

Description of Goods

Customs Duty (CD)

Supplementary Duty (SD)

Revenue Effect (Crore Tk.)

Present

Proposed

Present

Proposed

Gain (+)

Loss (-)

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

1.        

Ruhi, katla, mrigel, pangash, karp and alike

   

20%

40%

0.60

 

2.        

Milk in powder form, in retail packing

   

20%

25%

1.43

 

3.        

Milk in powder form, in bulk

   

10%

15%

19.11

 

4.        

Butter & Other Fats

   

20%

25%

0.77

 

5.        

Cheese and Curd

   

20%

25%

0.03

 

6.        

Dates (excluding wrapped / Canned)

   

30%

40%

4.90

 

7.        

Fresh and Dried mango, oranges, lemons, grapes, apples and other (excluding wrapped / Canned)

   

30%

40%

7.94

 

8.        

Cinnamon, cardamoms, cloves & pepper

   

0%

25%

45.61

 

9.        

Refined pulm oil

32.5%

7.5%

-

-

 

0.02

10.     

Refined coconut oil & Other

   

20%

25%

1.25

 

11.     

Linseed oil, Tung oil

32.5%

22.5%

-

-

 

0.03

12.     

Sugar (raw-sugar)

   

20%

40%

230.83

 

13.     

Raw sugar (Containing added flavouring or colouring mater and other)

22.5%

30%

0%

40%

0.45

 

14.     

Glucose and Glucose syrup

   

10%

15%

0.13

 

15.     

Chocolate & Candi

   

30%

40%

3.25

 

16.     

Tapioca, Sago

22.5%

15%

-

-

 

0.72

17.     

Sweet biscuits, waffles & wafers

   

30%

75%

2.32

 

18.     

Jam, fruit jellies, marmalades, orange juice, apple juice & similar goods

   

20%

40%

0.80

 

19.     

Soya sauce, tomato cachup & similar goods

   

20%

40%

1.75

 

20.     

Food preparation not elsewhere specified or included : containing alcohol exceeding alcoholic strength 0.5% by Vol.

   

350%

250%

 

2.31

21.     

Soft drinks

   

30%

40%

0.53

 

22.     

Non-Alcoholic beer

   

60%

75%

0.00

 

23.     

Beer

   

250%

150%

 

1.85

24.     

Whiskies, rum and tafia, gin and geneva, vodka, liqueurs and cordials & other wine

   

350%

250%

 

0.14

25.     

Cigar, Cheroots, Cigarillo

   

30%

75%

00

 

26.     

Salt

   

60%

75%

3.56

 

27.     

Other salt

   

30%

40%

0.00

 

28.     

Dolomite, not calcined or sintered

22.5%

15%

-

-

 

0.22

29.     

Portland cement

   

30%

40%

2.03

 

30.     

Grey portland cement in bulk

   

20%

25%

0.14

 

31.     

Granulated Slag & Other Slag

0%

15%

-

-

3.30

 

32.     

Fly Ash

7.5%

15%

   

0.13

 

33.     

Refined Tar

   

10%

15%

0.00

 

34.     

Jet fuel & other white spirit

   

20%

15%

 

10.95

35.     

Naphtha

   

20%

15%

 

0.00

36.     

Jet fuel

   

30%

25%

 

2.73

37.     

Kerosene

   

20%

15%

 

28.88

38.     

Diesel oil, Furnace oil

   

20%

15%

 

120.13

39.     

Partly refined petroleum including topped crudes, greasen, Transformer oil, Other oil excluding Heavy normal paraffin

   

20%

15%

 

0.29

40.     

Sulphuric Acid; oleum

   

20%

25%

0.10

 

41.     

Rasist Salt

15%

7.5%

     

0.06

42.     

Isopropyl Alcohol

0%

7.5%

   

0.85

 

43.     

Acetic Acid

32.5%

22.5%

-

-

 

0.23

44.     

Soap Noodles

   

0%

15%

8.52

 

45.     

DOP

   

10%

15%

0.08

 

46.     

Mixer of odoriferous substance for beverage

7.5%

15%

-

-

5.85

 

47.     

Beverage concentrate

22.5%

15%

-

-

 

2.31

48.     

Industrial petrolium bitumen

7.5%

15%

   

2.91

 

49.     

Sodium Chlorates

22.5%

15%

     

0.02

50.     

Sodium Sulphides, Sodium Dithionites, Zinc Sulpoxylates, Sodium Bicarbonate, Sodium Nitrates & Formic Acid

15%

7.5%

     

2.75

51.     

Sodium Acetate, Citric Acid & Beta Carotene

15%

7.5%

     

0.23

52.     

Paints, Varnish & lacquers

   

0%

25%

1.02

 

53.     

Preparation for the Treatment of textile materials

15%

7.5%

     

0.38

54.     

Propellant powders, Prepared explosves, Fireworks, signalling flares, rain rockets, fog signals and other pyrotechnic articles

   

0%

25%

0.50

 

55.     

Matches

   

0%

15%

0.00

 

56.     

Fungicide : For agricultural purpose

15%

7.5%

-

-

 

2.43

57.     

Blended Powder/Flux

22.5%

15%

-

-

 

0.78

58.     

Silicones In Primary Form, Carboxymethyl, Sodium alginate

15%

7.5%

     

1.04

59.     

Hose Pipe

32.5%

15%

     

0.04

60.     

Self adhesive plates, sheets, film, foil, tape, strip

   

10%

15%

0.93

 

61.     

Ethylene polymer, Poly (vinyl butyral) & Other Plate, sheet, film, Foil and strip of plastic of plastics

   

10%

20%

15%

0.80

 

62.     

Baths, shower - baths, sinks, wash - basins, bidets, lavatory pans, seats and covers, flushing cisterns and similar sanitary ware, Tableware, kitchenware of plastics.

   

10%

25%

1.68

 

63.     

Surgical Gloves

15%

7.5%

-

-

 

0.22

64.     

Linear Alkylbenzenes

15%

7.5%

-

-

 

0.01

65.     

Particle Board, Fibre Board, Fly-Wood)

   

0%

15%

2.91

 

66.     

Fibre Board

   

10%

15%

0.85

 

67.     

Wool

15%

7.5%

     

0.01

68.     

Polyester Yarn

22.5%

30%

   

1.39

 

69.     

Polyester Yarn : partially oriented

7.5%

15%

   

1.13

 

70.     

Carpet & Floor covering mat 

   

0%

15%

0.98

 

71.     

Cotton, T-Shirt, Trousers, Bib & Brace, overalls, breeches and shorts shirt, Bed Linen

   

0%

40%

1.86

 

72.     

Sports footwear with outer soles of rubber, plastic, leather or composition leather and upper of leather

   

0%

15%

0.88

 

73.     

Other footwear

   

0%

25%

5.74

 

74.     

Granite, travertine and alabaster & Marble stone

   

20%

40%

1.30

 

75.     

Emery clothes

   

20%

25%

0.66

 

76.     

Unglazed/Glazed ceramic flags and paving, heart or wall tiles, unglazed ceramic mosaic cubes and the like, whether or not on a backing

   

30%

40%

4.55

 

77.     

Wared & non-wared glass

   

30%

40%

0.82

 

78.     

Glass Mirror

   

0%

40%

4.42

 

79.     

Amber glass : Bottle & Jar

7.5%

15%

   

2.13

 

80.     

Difference type of Glassware

   

30%

40%

2.88

 

81.     

Unworked Jams, Pearls, Diamond or other precious stones

7.5%

0%

     

00

82.     

Semi Finished Jams, Pearls, Diamond or other precious stones

22.5%

7.5%

     

0.02

83.     

Finished Jams, Pearls, Diamond or other precious stones

32.5%

7.5%

     

00

84.     

C.I.Sheet

22.5%

30%

   

00

 

85.     

Raw materials for pre-fabricated building : Flat rolled products

15%

7.5%

     

0.05

86.     

Difference type of pipe & Shaft, circular cross-section

   

10%

15%

0.50

 

87.     

ERW pipes and stainless shafting of iron or steel.

   

30%

40%

3.01

 

88.     

Iron or non aloy steel made other welded of circular cross-section : Other

   

10%

15%

0.03

 

89.     

Bicycle Chain and parts thereof

   

20%

25%

0.46

 

90.     

M.S. Nipple

32.5%

15%

-

-

   

91.     

Cooking appliances and plate warmers : for Gas fuel

   

20%

25%

0.22

 

92.     

Sanitary ware and parts thereof, of iron or steel : Sinks and wash basin

   

30%

40%

0.75

 

93.     

Grinding balls and similar articles for mills

22.5%

15%

-

-

 

0.26

94.     

Copper wire

15%

22.5%

   

1.86

 

95.     

a) Nickle coated copper wire

22.5%

15%

     

0.01

b) Blanks and Demos of Plastic

15%

7.5%

     

0.01

96.     

Sanitary ware and parts thereof

   

30%

40%

0.04

 

97.     

Aluminium wire

15%

22.5%

-

-

0.04

 

98.     

Zinc Callot

7.5%

15%

-

-

0.75

 

99.     

Rassors

   

0%

15%

1.25

 

100.  

Padlock

   

0%

25%

11.45

 

101.  

Iron & Steel made Stoppers, Caps

32.5%

22.5%

     

0.11

102.  

Pump without Hand pump, Vehicle pump & agricultural pumps

15%

7.5%

     

0.96

103.  

Fan & Fan parts

   

20%

25%

0.92

 

104.  

Air Conditioner (CBU)

   

30%

40%

5.19

 

Air Conditioner (CKD)

   

20%

25%

0.39

 

105.  

Refrigerator & Freeser (CBU)

   

0%

15%

24.82

 

106.  

Water filter use in home and industry

22.5%

7.5%

     

0.62

107.  

Furniture, bases and covers for sewing machines and parts thereof

15%

7.5%

-

-

 

0.02

108.  

Tape, Cock, Valve

7.5%

15%

   

0.60

 

109.  

Dry cell battery & Lead acid battery

   

30%

40%

1.00

 

110.  

Radio cassette player (CBU)

   

10%

25%

15%

0.45

 

111.  

Pocket size radio cassette player (CBU)

   

0%

15%

0.00

 

112.  

Difference type of two in one

   

0%

15%

1.65

 

113.  

Colour TV (CBU)

22.5%

30%

0%

15%

52.23

 

B/W Television

22.5%

30%

-

-

1.17

 

114.  

Mobile Phone :

a) CIF Value upto Tk. 10,000/-

b) CIF Value exceeding Tk. 10,000/-

Specific duty 2500/- (per set)

3000/-

4000/-

-

-

13.00

 

115.  

Dicharge lamps & parts

   

20%

25%

0.29

 

116.  

Fluorescent Lamp (Tube light)

   

30%

40%

2.00

 

117.  

Aluminium base cap lamp

32.5%

30%

20%

0%

 

0.90

118.  

Winding Wire : Other

   

30%

40%

0.51

 

119.  

Coaxial cable and other coaxial electric conductors

   

20%

25%

0.53

 

120.  

Lamp carbon, carbon rod

   

0%

15%

0.14

 

121.  

Three wheeler Auto Ricksaw :

           

a) Four Stroke auto Ricksaw with Engine/ Three wheeler

   

30%

40%

5.07

 

b) CNG Operated Four Stroke Auto Ricksaw (CBU)/ Three wheeler

15%

22.5%

10%

15%

9.23

 

c) Four Stroke Auto Ricksaw/ Three wheeler's Chassis with Engine

   

30%

40%

0.04

 

122.  

Motor Vehicle (with station wagon) :

           

a) Cylinder Capacity upto 1649 CC

   

0%
(Recondit-ioned Vehicle 10%)

15%

38.00

 

b) Cylinder Capacity upto 1650 CC to 3000  CC

   

20%

40%

22.43

 

c) Cylinder Capacity exceeding 3000 CC

   

60%

75%

0.00

 

123.  

CKD Pickup

22.5%

15%

     

0.43

124.  

Two Stroke Motor Cycle (CBU & CKD)

   

30%

40%

21.88

 

125.  

Four Stroke Motor Cycle (CBU & CKD)

   

0%

15%

126.  

Bicycle & Other Cycle

   

0%

40%

16.87

 

127.  

Artificial Parts & Other

7.5%

0%

     

0.00

128.  

Revolvers, Pistols & Weapons (.22 & 7 mm bore with rifles)

   

60%

75%

0.08

 

129.  

Parts of Revolvers or Pistols & Barral of Shotgun & other

   

20%

25%

0.00

 

130.  

Bomb, Granad, Torpedoes, Mines, Missiles : Cartoge for Revating and Similar goods, Parts & Other

   

60%

75%

0.00

 

131.  

Sword, Cutlasses, Bayonets, Lances & Similar Arms : Others

   

60%

75%

0.02

 

132.  

Furniture

   

0%

15%

0.58

 

133.  

Pre Fabricated Building

15%

7.5%

     

5.65

134.  

Toy & Dolls

   

0%

75%

16.15

 

135.  

Angiographic Catheters Wire, & Sheath, Guidy Catheters Wire, Baloons & Stents

7.5%

0%

     

0.01

136.  

Different types of Dental Fittings, Artificical Parts & Joints

7.5%

0%

     

0.00

137.  

A) CFC-12

15%

22.5%

   

0.88

 
 

B) HFC-134a

15%

7.5%

   

138.  

Raw Materials for Agro processing industry - Gum base, Straw, Shrink level, Confactionery raper & Plastic Cap

32.5%

22.5%

     

1.02


Annexure-"D"

National Board of Revenue’s revised budget for fiscal year 2002-2003 and budget allocation for fiscal year 2003-2004 under different heads of account

(Figure in crore Taka)

Serial no.

Revenue Account Head

2002-2003 Fiscal year’s Original Budget target

2002-2003 Fiscal year’s revised Budget target

2002-2003 Fiscal year’s collection upto April, 2003

2003-2004 Fiscal year’s estimated target

(1)

(2)

(3)

(4)

(5)

(6)

1.

Import Duty

5890.00

5890.00

5454.75

7628.00

2.

Value added tax

(import stage)

4375.00

4375.00

3357.45

4685.00

3.

Supplementary duty

(import stage)

1550.00

1550.00

1058.89

1492.00

Total-Import stage

11815.00

11815.00

9871.09

13805.00

4.

Value added tax

(local stage)

3696.00

3696.00

2796.10

4432.00

5.

Supplementary duty

(local stage)

2825.00

2825.00

2520.06

3410.00

6.

Excise Duty

310.00

310.00

285.00

348.00

Total-local stage

6831.00

6831.00

5601.16

8190.00

7.

Income tax

4788.00

4788.00

2990.49

5365.00

8.

Other tax and duty

316.00

316.00

203.65

390.00

 

Grand total

23750.00

23750.00

18666.39

27750.00

** Revenue target for fiscal year 2003-2004 is Tk. 27750.00 crore, which is 16.84% growth over the revised target (Tk. 23750.00 crore) of the previous year.