January 22, 2024
DHAKA – The government is considering reducing the value-added tax and supplementary duty on essentials such as edible oil, sugar, and dates in its efforts to keep the prices affordable for Ramadan.
The development comes after an inter-ministerial emergency meeting of the finance, commerce, food, and agriculture ministries and the divisions concerned and the Bangladesh Bank as the newly-formed Awami League government looks to make good on its top election promise.
With the country mired in elevated inflation for more than a year now, the AL in its election manifesto for the 12th national polls pledged to make every effort to keep the prices of essentials within the affordability of all.
Were the chairman of the National Board of Revenue present at yesterday’s meeting, Finance Minister Abul Hassan Mahmood Ali would have taken a call on the duty cuts for the essential imports, meeting sources said.
The meeting, which lasted for more than two hours, pored through the letters of credit data from the last couple of years and found that LCs opened this year for essentials are 10 to 15 percent more than in previous years.
The meeting also compared LCs from three months before Eid last year and found that more LCs were opened this year for essentials.
It also learnt that there is no problem with opening LCs, so the essential importers cannot use that as an excuse, the sources said.
However, there are some hold-ups in releasing goods from the ports and asked the authorities concerned to ensure quick customs clearance for the consignments.
The meeting also reviewed the stock of edible oil, dates, sugar, chickpeas, and lentils and concluded that there is enough supply.
So the government will take tough actions if any non-economic factors such as market manipulation and supply chain disruptions make the market unstable, The Daily Star has learnt from officials informed about the discussions in the meeting.
There would be regular monitoring too.
“I will not spare anyone — we will take drastic measures if anyone tries to destabilise the market,” Ali told reporters after the meeting.
There is enough stock of items consumed during Ramadan.
“Some quarters are looking to destabilise the situation. They try to take advantage wherever there is a market economy.”
Asked if he would initiate drastic measures now given that the prices of essentials are spiralling, he said: “No, not yet.”
At the meeting, the commerce ministry has been empowered to import eggs, potatoes, rice, and dates if it feels necessary without needing further permission.
The ministry will request the ministry of power, energy and mineral resources to ensure uninterrupted supply for industries that process everyday essentials.
The meeting also decided to request the home and transport ministries to take action so that good-laden trucks do not face any obstacles on the roads and are not victims of highway extortions.
The fisheries and livestock ministry will sell fish, meat, eggs, and milk at more than 20 points in Dhaka. The ministry is also exploring whether it would be possible to extend this operation outside the capital during Ramadan.
The commerce ministry also requested BB to direct banks to prioritise LC opening with minimum margins for edible oil, sugar, chickpea, lentil, and date imports.
Ahsanul Islam Titu, the state minister for commerce, is planning to visit India to request the neighbouring country to keep a quota of seven essential commodities for Bangladesh with the view to keeping the prices of the items stable.
Besides, the Trading Corporation of Bangladesh will continue selling rice, sugar, edible oil and lentils at subsidised prices to one crore families to give respite to the poor and low-income earners.
For Dhaka residents, TCB will sell chickpeas and dates during Ramadan.