Finance Minister Abul Hasan Mahmud Ali presented the first budget of the 12th National Parliament on Thursday (June 6) at 3 pm. He started raising the proposed budget of Tk 7 lakh 97 thousand crore for the new financial year.
Every year after the announcement of the new budget, the prices of several products change. By withdrawing duties and taxes on some products, the prices of some products are reduced. Again, due to the imposition of new taxes on some products, the prices of many products increased.
The budget proposes to increase and decrease the prices of the following products.
Commodities those prices may rise:
Cigarettes
The price of all types of cigarettes is set to increase. A 60 to 65.5% supplementary duty hike on various categories of cigarettes has been proposed.
Phone and Internet services
The supplementary duty may increase SMS and call rates and internet costs.
Oils
Prices of furnace oil, lubricants, mineral lubricants, and base oil are likely to increase.
CNG Conversion Kits, and Cylinders
Import duty is proposed to increase from 3% to 5% on these goods. So, the expenditure may grow in this sector.
Power Plants
Import duty on equipment and materials for the Rampal power plant as well as various power generating stations has been increased from 0 percent to 5 percent.
Establishments at Economic Zones
It has been proposed to levy a 1 percent customs duty instead of a subsidised facility (duty-free) on the import of capital machinery and construction materials in economic zones.
Air conditioners and Refrigerators
Import duties on compressors and steel sheets used in AC production as well as raw materials for refrigerators have been proposed to increase. As a result, the price of air conditioners and refrigerators may increase.
Water Filters
The price of household water filters may increase as the import duty on these has been proposed to increase from 10 percent to 15 percent to promote the local manufacturers.
LED Bulbs
A proposed 10 percent import duty on energy-saving bulb manufacturing materials may raise the price of LED bulbs.
Car
Currently MPs can import cars at duty-free facilities. The finance minister has proposed to impose 25% supplementary duty and 15% VAT on the import of cars in the proposed budget by canceling this benefit in the budget to reduce inequality. On the other hand, some specific conditions have been added in the proposed budget to exempt hybrid and non-hybrid type cars to prevent duty evasion in luxury cars. As a result, prices of luxury cars are likely to increase.
Generator
Again, the use of generators in homes or industries is increasing to deal with load shedding. NBR has also looked there. One percent duty is being levied on the import of materials or parts used in the assembly and manufacture of generators. Therefore, the price of generator may increase in the market of the country.
Soft drinks and Energy drinks
VAT on soft drinks, carbonated beverages, energy drinks, mango bar may be increased from 5 to 10%. Apart from this, the minimum tax on carbonated beverages may be increased by another 2% to 5%. As a result, these products have to be bought at a higher price.
Fruit Juice
Apart from this, in the new budget, the finance minister proposed to increase the VAT rate from 5% to 15% on the production of mango bar, fruit juice, tamarind juice, guava juice, pineapple juice etc.
Cashew Nuts
A 5% to 10% import duty on shelled cashew nuts has been proposed as part of safeguarding the domestic industry. So, the price of these delicacies may increase.
Hospital Equipment
Importation of medical devices and equipment is allowed at duty free facility of referral or specialized hospital at 1% duty subject to compliance of certain conditions. In the next budget, the finance minister has proposed to increase the import of over 200 medical devices and equipment to 10%, which may further increase the medical expenses of critically ill patients.
Cosmetics
VAT is being increased on cosmetic products in the budget. Supplementary duty is being increased on cosmetics, lipstick, hair care products. Therefore, the prices of cosmetics items may increase.
Mobile Talking
If the scope of revenue collection is increased, the consumer will have to pay more for talking on mobile. At present, a consumer can talk about 73 taka if he recharges his mobile by 100 taka. The mobile operators deduct the remaining 27 taka as VAT and supplementary duties. If the 5 percent supplementary duty on mobile services is increased in the proposed budget, the consumer will be able to talk about 68 taka.
Security Services
In addition, security services have become almost essential in various sectors including homes, offices, and business establishments in big cities including the capital Dhaka. Now 10% Value Added Tax (Musak) or VAT has to be paid for taking such security services. The finance minister has proposed to increase it to 15% in the next budget.
Lease of Markets
In order to increase non-tax revenue, the rental price of markets at district, upazila and even union level will increase slightly in the next budget. Along with that, the land registration fee will also increase.
Entertainment Expenses
Many people visit amusement parks and theme parks to spend time with their families. Currently, 7.5% VAT is levied on entry and rides in amusement parks and theme parks. It is being increased to 15%. This will increase the cost of visiting the park.
Excise duty on the Rich
Of course, the rich are being overtaxed this time. Currently, the rich class pays income tax at 25%, in the future it will be 30%. Income tax at the rate of 30% will be paid if the annual income reaches 38 lakh 50 thousand taka. On the other hand, the bank excise duty is also being increased. Excise duty of Tk 1 lakh per year will be deducted from bank accounts above Tk 5 crore.
Other Products
Prices may also increase for products such as ice cream, amusement parks, and tourism services as the ministry also proposes VAT on these sectors.
Commodities whose prices may fall:
Essential commodities
The import duty of 30 essential commodities including rice, edible oil, sugar, chickpeas, milk and wheat has been proposed to be reduced.
Aircraft Engines & propellers
VAT withdrawal on imports of aircraft engines and propellers has been proposed considering the prospect of the aviation sector.
Powdered milk
A 20% supplementary duty on the import of packaged powdered milk has been withdrawn. This may reduce the price of imported powdered milk.
Laptops
VAT has been withdrawn on the import of laptops to stop the import of used laptops. Import duty has been reduced to about 20.50% from 31%.
Motorcycles
Import duty on engine parts has been reduced which may bring down the price of motorcycles under 250cc made in the country. However, price of motorcycles above 250cc is expected to rise.
Dengue test kits
Exemptions of import duty, value-added tax, and advance tax on rapid dengue detection test kits, dengue re-agents, and platelet and plasma test kits for dengue treatment have been proposed.
Kidney treatment
The import duty on dialysis filters and dialysis circuit products, the most popular tools for treating kidney patients, has been reduced from 10% to 1%.
Cancer Treatment
Import duty waiver on some equipment used in the treatment of cancer has been proposed. Apart from this, the concessional facility for the import of raw materials required for the production of medicines, medical equipment and health protection equipment will continue in the next financial year.
Carpets
Import duty on polypropylene yarn, the main raw material for making carpets, has been reduced from 10% to 5%.
Electric Motors
A subsidy has been proposed to increase the import of parts used in the production of electric motors.
Methanol: Methanol is one of the raw materials of industries such as medicine, washing plants, paint etc. The import duty rate has been reduced from 10% to 5% if this product is imported in bulk.
Agricultural machinery
Prices of agricultural machinery may decrease. Tariff benefits on import of agricultural inputs will be continued.
Foreign Chocolates
In the proposed budget, the Finance Minister has proposed to reduce the supplementary duty on import of chocolate from 45% to 20%. Due to this, the price of imported chocolate may decrease.
Switch-Socket
The price of switch-sockets used in households may decrease. Because the import duty of raw materials used in the production of switch-sockets, holders manufactured in the country is being reduced.
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