Paper, paper board businesses demand duty cut

DHAKA, Paper importers, merchants, textbook printers and press owners today requested the government to cut the import duty from 25 percent to 5 percent to ensure smooth supply of papers to help keeping their business afloat.

Six related associations Bangladesh Paper Importers Association (BPIA), Bangladesh Paper Merchants Association (BPMA), Bangladesh Textbook Printing and Marketing Association (BTPMA), Chittagong Papers and Cellophane Business Group (CPCBG), Printing Industries Association of Bangladesh (PIAB) and Metropolitan Press Owners Association (MPOA) raised the demand at a joint press conference at the Economic Reporters Forum auditorium here.

Because of the higher duty, we are gradually losing our business, said Md Shafiqul Islam Vorosha, president of BPIA.

The key raw materials for the countrys printing, publication and packaging industries are duplex board, art paper, art card, Swedish board, folding box board and self adhesive paper and these have huge demand in Bangladesh.

These products are not produced in Bangladesh. There are some paper mills in the country that only produce papers used for writing, newsprint, media and liner paper, cigarette paper, tissue paper and substandard board.

But, there is very high duty on the imported paper and boards, Shahid Serneabat, chairman of PIAB said.

Because of the 25 percent import duty, the total tax incidence for the products comes at 60.73 percent.

The import duty has been continuing for a long time. Now it is a question of survival for us. Because of the higher duty, there is misuse of paper and boards imported under the bonded warehouse facility, Vorosha said.

Imported products are no way competitors to the local paper mills, said Serneabat.

The imported raw materials are also being used in other industries such as pharmaceuticals, cosmetics, food processing and electric as well as in invitation cards, sweet box, wall calendar, and desk calendar.

If the import duty is brought down to 5 percent, the overall tax incidence will be 32.40 percent, according to the organizers.

The duty is 10 percent in India and there is another 12 percent GST (goods and service tax), bringing the total tax incidence to 22 percent only, according to Vorosha.

The organizers said they are not against the products brought under the bonded warehouse facility. But, the reality is these products are being sold in open market. As a result, the government is losing Taka 2,000 crore in annual revenue, whereas dishonest businessmen are making the benefits.

If import duty is cut to 5 percent and the bonded warehouse facility for importers is maintained, then the misuse of bonded facility will come to an end and the market is stabilized, they said.

The government fixed 5 percent import duty on plastic raw materials two years ago in order to stop the misuse of the bonded warehouse facility a decision that is giving more revenues for the government, according to Tofayal Khan, President of BTPMA.

The same can be done in case of commercial import of paper and paper board, he said.

Vorosha said the industry has huge prospect in the coming days. These are no longer luxury items. Already, local manufacturers are getting export orders.

Every year, about 5 lakh tonnes paper and paper boards are imported, according to the organizers.

Md Zahurul Islam, general secretary of PIAB, said local paper mills should not oppose the legal import of papers and paper boards.

Fazlur Rahman Parbat, president of BPMA and Mohammed Belal, general secretary of CPCBG, were present.

Source: Bangladesh Sangbad Sangstha (BSS)