Bangladesh Cement Manufacturers Association (BCMA) President and vice chairman of M I Cement Factory Ltd. (Crown Cement) Md Alamgir Kabir said currently cement industry passing a trying time for various reasons including imposing additional import duty on ‘clinker’ the main raw material of cement in the proposed budget of 2023-2024 fiscal year.
Other reasons included additional advance income tax, unadjustable advance income tax, fuel crisis, hike of transport fare, dollar crisis, prices hike of other materials and various problems, he said.
Alamgir Kabir came up with the observation while speaking a press conference titled ‘Additional Tax Burden & Other Impediments-Cement Industry in Deep Crisis’ at a city hotel on Monday.
He said additional customs duty (Tk 700 in per metric tonne) has been imposed on clinker in the proposed budget of 2023-2024 fiscal year while cement producers have been demanding logically for long to cut the customs duty from exiting Tk 500 to Tk 200 in per metric tonne. But instated of reducing duty it has been increased at Tk 700. Cement producers are frustrated by this decision.
Generally customs duty is fixed 5 per cent of import price of the main raw material of any industry. But proposed duty is around 12%-13% of import price on clinker import. It is seems imbalanced. This additional duty would create additional pressure on the consumers which might effect on the overall construction sector, Alamgir added.
Alamgir Kabir said, “In import stage 2 per cent advance income tax on clinker, 3 per cent on slag, 3 per cent on fly ash, 5 per cent on limestone, and 5 per cent gypsum are considered as ultimate liability. We have been demanding for long to impose advance income tax at highest 0.50 per cent. But ill won’t be a wise decision to consider advance income tax as ultimate liability. We are demanding to keep a chance to adjust the advance income tax.
Besides import state, 2 per cent advance income tax is being imposed at selling stage and it is been considered as ultimate liability. Cement producers have been demanding for long to impose advance income tax at highest 0.50 per cent at selling stage. We are also demanding to keep a chance to adjust the advance income tax at selling stage. Besides, giving advance income tax at selling stage is equal to dual tax as advance income tax is paid at import stage on raw material.”
The BCMA chief said if the government announces cement as priority sector considering the current situation and give necessary directions to concerned departments of the government including bank, then the cement sector will be saved.
He said due to dollar crisis import of the raw materials is being hindered and the import cost is also increased. Cement sector owners are facing serious obstacle to opening LCs. On the other hand, factory production is stopped due to load shedding. At the same time, power production is being hampered lack of gas. Local transport cost of cement is being increased lack of fuel oil. Besides, there is no cash incentive on cement export which is also a bar in the sector.
Alamgir Kabir called upon the government to reduce the customs duty from Tk 700 to Tk 200 in per metric tonne and impose advance income tax at highest 0.50 per cent primarily at both import and selling stage and not consider advance income tax as ultimate liability.
@ The article was published on print and online versions of The Bangladesh Pratidin on June 13, 2023 and has been rewritten in English by Golam Rosul.
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