Customs wants hike in beef import duty

Jasim Uddin | Updated at 09:22pm on March 17, 2018

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A file photo shows a man arranging chunks of beef while another cutting a beef chunk into pieces at a shop in Dhaka. The customs valuation department of the National Board of Revenue has recommended that the government raise import duty on frozen beef to protect the local meat industry. — New Age photo

Customs valuation department of the National Board of Revenue has recommended for setting minimum tariff value of imported beef to protect the local dairy industry.
Customs Valuation and Internal Audit Directorate in last month made the recommendation saying that that import price of the frozen beef was lower than the price of the item at domestic kitchen market which poses threat to local dairy farms.
Price of an imported good should not be lower than the locally produced one, CVIAD wrote to NBR on February 7.
Actual transaction value is generally accepted for the purpose of levying customs duties. But customs authority may fix minimum tariff value or import price of any item to protect revenue and domestic industry in various situations like distortion of price and under invoicing.
Officials said that the CVIAD in January hold a meeting with the Department of Livestock Services and Chittagong Customs House to review the import price of frozen beef and recommend the minimum import value for the item.
Analysing the database of Asycuda Word system of the Bangladesh Customs, the valuation directorate found that frozen beef was being imported on an average at $ 3.50 or Tk 280 a kilogram from Australia and Thailand and $ 0.57 or Tk 44 a kg from Malaysia.
The price of the beef imported from Australia and Thailand, and Malaysia stands at Tk 372 and Tk 60 respectively including the customs duty and taxes.
Currently, 33 per cent of customs duty and other taxes are applicable in import of beef.
A total of 14,745 kg beef meat was imported, mostly from Australia, during July 2016 and January 2018, according to the CVIAD.
Dhaka City Corporation in May 2016, ahead of Ramadan, set the price of beef at Tk 420 a kg for city corporation area. In 2017, the price was set at Tk 475 a kg.
Beef was being sold at Tk 460 a kg to Tk 500 a kg at different kitchen market in Dhaka.
‘It is not rational to allow import of beef at lower price than the prices at domestic market,’ CVIAD said in its letter signed by the then commissioner SM Humayun Kabir.
The cattle farm sector has been flourishing over the years in the country and a large number of youth population are now raising cow at their farms and producing beet meat making the country self-sufficient in meat production, it said.
Officials said that local dairy farm industry and related sectors including leather would destroy if import of beef at lower price than local market price continues.
In this context, it would be a timely step to set the minimum import value of beef to protect the local farms and entrepreneurs, they said.
The CVIAD proposed the minimum valuation price at $ 4 a kg of beef originated from Asia and $ 6 a kg for other than Asia origin for consideration of the revenue board.
Import price of beef will stand at Tk 425 a kg and Tk 638 a kg including the taxes and duty respectively for Asia and other than Asia origin.
At the meeting, DLS director Hiresh Ranjan Bhowmik said that the livestock ministry as well as the department had already requested the commerce ministry to prohibit import of beef to protect local industry after some traders approached the commerce ministry to allow import of the item from India.
He said that the DLS had taken various steps to increase meat production in the country to fulfill the domestic demand as well as create scope of export.
Officials of the valuation department said that import of beef was not banned as per the import policy of the country.
Country’s five star hotel, tourism sector, diplomats and international franchise also needed imported beef, they said.
So, imposing ban on import of the item will be difficult, they added.
They said that determining the minimum valuation price would be the best option to address the issue.