The National Board of Revenue Asks Customs Houses to Conduct Tax Assessment of Imported Refrigerators

The National Board of Revenue recently instructed the customs houses to conduct tax assessment of imported refrigerators at a minimum value at the entry point to check under-invoicing.

Customs department of the NBR ordered the officials not to assess value of imported refrigerators if invoice shows value of each below US$ 1.0 to $1.50 per litre.

Customs department recently issued an order to all customs houses including Dhaka, Chittagong, Mongla, Benapole, Sylhet, Rajshahi, Jessore and Khulna customs house in this connection.

Talking to the FE on Septemper 13, 2011 a senior customs official said it has been instructed to follow the value after allegations of huge under-invoicing on import of refrigerators.

"Price of two door refrigerators should be minimum $1.0 per litre and side by side door or three doors with display panel should be $1.50 per litre," he said.

The customs officials will not assess any refrigerator which will show import value below the price, he added.

The value has been proposed following recommendation of a high-powered NBR team that visited the major exporting countries of refrigerators.

The team visited China and Thailand to assess the actual price of the refrigerators.

The team has proposed the minimum value of imported refrigerator after reviewing prices of different sales centres and adjusting local tax and expenditure in different stages and profits of importers.

"Value of refrigerator, brand or non-brand, should not be assessed for tax in the customs houses below the above mentioned price. But, if importers declare higher prices than that of the minimum price the customs will have to assess the value at higher price," the order said.

All of the refrigerators are imported with a brand name, so customs will not offer any tax benefit on import of non-brand refrigerators, it added.

Local refrigerator manufacturing and exporting company Walton hailed the new order of customs saying that it will help the local refrigerator industry to expand its network.

"We were concerned about the import of huge number of substandard refrigerators. Some importers are importing those through under-invoicing declaring cheap price," said Uday Hakim, a senior deputy director of Walton.

The country is turning into a dumping ground for substandard imported refrigerators while the local manufacturers are capable of producing quality refrigerators, he said.

The government is also losing huge amount of revenue through under-invoicing on import of refrigerators, he added.

Hakim urged the government to monitor enforcement of the order to stop the malpractice.

In an in- depth investigation in 2010, the government had found massive under invoicing and false declaration of value on import of refrigerators.

Bangladesh Tariff Commission (BTC) launched the investigation and decided to propose the NBR to impose anti-dumping duty to check import of substandard refrigerators.

BTC chairman Dr. Mojibur Rahman said the commission is scrutinising the matter and reached its final stage to propose imposition of the anti-dumping duty.

"We are collecting all relevant information as a ground work to recommend on slapping the duty," he said.