The lean season for local fruits in Bangladesh has led to a surge in prices of imported fruits, affecting consumers ahead of Ramadan. The Bangladesh Trade and Tariff Commission (BTTC) has recommended reducing import duties on fresh fruits such as apples, oranges, grapes, pears, and pineapples. The BTTC sent a letter to the National Board of Revenue (NBR) on February 17, urging a reduction in the tax burden.
Fruit vendors in Dhaka report that prices of imported fruits have increased by 40-60% compared to last year. Apples are priced at $3.30-$4.70 per kg, oranges at $3.30-$4.10 per kg, grapes at $5.30-$10 per kg, and pomegranates at $5.30-$6.50 per kg. According to the Bangladesh Fresh Fruits Importers Association, importers and wholesalers have increased prices by 20-25% in the past month.
The price increase is linked to the government's decision to raise the supplementary duty (SD) on fresh fruit imports from 20% to 30%. There is also a 10% advance income tax (AIT) and a 20% regulatory duty (RD) on fruit imports. The tariff commission has proposed reducing the SD to 20%, slashing the AIT to 2%, and rationalizing the RD. The commission noted that the current tax structure, along with the appreciation of the US dollar, has made imported fruits less affordable.
The commission's letter to the NBR indicates that fresh fruit imports have declined due to the increased tax burden. January saw a decline in imports of mandarins by 51%, pears by 45%, pomegranates by 32%, grapes by 21%, and apples by 3.5% compared to the same month last year. The commission cautioned that high customs duties could reduce future revenue collection.
Currently, importers pay $1.40 in taxes for every $1 worth of imported fruit. The commission suggested exempting advance tax at the import stage since fresh fruits do not undergo value addition locally. Sirazul Islam, president of the Bangladesh Fresh Fruits Importers Association, reported a 40-50% decline in imports due to high prices and reduced sales. He urged the government to rationalize duties ahead of Ramadan.
Kazi Iqbal Bahar Saberi, secretary of the Consumers Association of Bangladesh (CAB) in Chattogram, noted that fruit demand is expected to increase during Ramadan. He emphasized the need for government monitoring to ensure fair pricing from import to retail.
Source: Financial Express