3,500 Used Cars Imported Before June
Govt bows down to pressure from traders, gives tax benefit
Finance minister AMA Muhith has allowed 45 per cent depreciation instead of exiting 35 per cent for import of certain number of reconditioned vehicles following recommendations by the revenue board, officials said. The number of car, all of them have been imported from Japan, will be no less than 3,500 units and the benefit will cause revenue losses to the tune of Tk 100 crore, they said.
Of the cars, around 3,000 remained stuck at Mongla port and around 500 at Chittagong port.
Around 30 importers have not released the cars for the last one year. They have been demanding for 45 per cent depreciation benefit as a pre-condition to clear the cars occupying valuable spaces in the ports.
In early July, the importers applied to the finance minister and the NBR for conducting valuation of the cars imported before June this year allowing 45 per cent depreciation benefits adopted in the budget for the current fiscal year.
Before the current fiscal year, depreciation for the five-year old reconditioned cars was 35 per cent.
The release of the cars at the existing rate of depreciation will not be viable in terms of business, the importers said.
The NBR in September rejected their appeal saying entertaining the appeal will be contradictory to the existing rule.
It, however, changed its stand in less than two months and recommended for meeting the appeal as a special case.
Junior officials of the revenue board who were against the appeal from the very beginning apprehended something ‘fishy’ about the latest government move.
They also apprehended that the ruling party in power was allowing the benefit bypassing the rule to get favour of the business community in the next general election that is likely to be held in next January.
NBR chairman Gholam Hossain, however, ruled out violation of any guideline. He said it was a special case and was done in line with the law.
He said it was a responsibility of the government to look after the interest of the importers who are facing problem after importing so many cars.
Gholam Hossain said the NBR examined alternative option of auctioning the cars.
But it was found that the generation of revenue will be far lower, he said, adding that the ‘duty worth at least Tk 500 crore will be mobilised despite allowing higher depreciation.’
The NBR insiders said a circular might be issued in this connection very soon.
Abdul Haque, managing director of Haq’s Bay Automobiles Ltd and a director of the Federation of Bangladesh Chambers of Commerce and Industry, is among the importers who brought in around 1,000 old cars.
He said they were not releasing the cars as an appeal to the government remained pending.
The importers will face huge losses in business if their demand was not fulfilled, he said.
Besides, the commercial banks would not get their money back in due time and the government would lose revenue, he said.
-With New Age input
