No relief for consumers even after 50pc duty cut

In an attempt to alleviate the financial burden on consumers, the government has reduced import duties on sugar by 50 percent, resulting in a significant 161 percent year-on-year increase in imports. Unfortunately, the retail price of this essential item has not seen a proportional reduction.

According to Bangladesh Bank, sugar imports increased by 161 percent in July-September, reaching $336.4 million from $128 million in the corresponding year.

Due to duty exemption, importers will now need to pay Tk 1,500 as a specific duty on each ton of raw sugar, down from Tk 3,000 earlier, as stated by the NBR in a notification. Similarly, the specific duty on refined sugar was slashed to Tk 3,000 per ton from Tk 6,000, while the retail price of sugar per kg is Tk 150.

Biswajit Shaha, the General Manager (Finance) of City Group, told the Daily Messenger, “The government has reduced the import duty by only Tk 1.5 per kg, but we still have to pay other taxes, amounting to Tk 43 per kg. Moreover, the dollar price has increased from Tk 117 to Tk 125.”

Additionally, he mentioned that the international market's sugar price has risen from $620 to $680 per ton. Therefore, traders are unable to reduce sugar prices at the retail level.

Ghulam Rahman, the President of the Consumer Association of Bangladesh (CAB), said, “Consumers cannot enjoy the advantage of duty cuts as importers have to pay Tk 42 per kg. The government should exempt more taxes on sugar and other daily necessities. Moreover, Bangladesh's normal import duty is higher than that of neighboring countries.”

The revenue administration, however, has retained a 15 percent value-added tax (VAT) and 30 percent regulatory duties on raw and refined sugar imports.

Bangladesh is highly dependent on sugar imports, and its price has increased over the last year due to the ripple effect from international markets and the rising cost of the US dollar.

Sugar prices rose to $0.58 per kg in September from $0.53 a month ago, according to World Bank Commodities Prices data.

Year-on-year, its average price climbed 35 percent to $0.54 per kg in September this year.

To reduce prices, private mills, which process raw sugar to meet 98 percent of the country's annual demand of 20 lakh tons, have been urging for a reduction in import tariffs.