Pre-budget speculation makes some items pricey

As speculation on possible increase of tax and duty on luxury goods import mounts up, prices of some items have showed an increasing trend.
Market sources and shoppers told New Age about the price increase of reconditioned cars and high-end mobile phone sets while some traders have started to build up their stocks of cigarettes and milk powder to reap more profit in case of duty increase in the next budget.
‘Visiting some car sales centers in the city in the past three or four days I have found the offer prices are Tk 20,000 to Tk 50,000 higher then that were offered a couple of months back,’ said Tariqul Islam, a government official.
Tariq has been searching a family sedan car at an affordable price for at least three months.
He has readied portion of necessary fund from his savings while a local private commercial bank has also assured him enough loan on his selected car.
‘It is disappointing that while I am searching a good car at lowest possible price it has rather become dearer just on speculation of increased tax in the upcoming budget,’ said Tariq.
Habibullah Don, president of the Bangladesh Reconditioned Vehicle Importers and Distributors Association said sales of cars had increased much in the pre-budget weeks but he denied any increase on prices.
‘Supply remains good, moreover, stronger yen is reducing the cost of Japanese cars,’ said Habib. ‘There is no reason for car price hikes now.’
While visiting Eastern Plaza and Motaleb Mansion in the city on Monday, many shoppers told this correspondent that they had been sensing an increasing trend on the prices of high-end mobile phone sets.
At present a flat Tk 300 duty is imposed on importing any kind of mobile sets but speculation is there that government was mulling 25 percent duty on mobile set imports again.
Abu Taher, a New Market shop owner admitted that he had observed a section of retailers procuring more cigarettes than what they had been used to procure regularly.
Citing his own experience, Abu Taher said he had found wholesale rates of pricey candies and premium grade imported cookies were on increase in the past one week. Speculation was there on possible increase on taxes on such items.
One senior sales representative of a foreign powdered milk told New Age that he had been receiving increased orders from a section of retailers and local distributors in the past few days.
‘I know their sales have not jumped suddenly but they want to make larger stocks to make windfall profits after any announcement on the increase of taxes,’ said the salesman, seeking anonymity.
It was reported in certain press that owing to safeguard local daily farmers, the government was mulling increased supplementary duty on the imports of milk powder.
Duty on milk powder was cut slightly last year responding consumers’ cry against exorbitant increase on price of powdered milk. Increased prices at import sources raised prices of powdered milk in local market while higher duty put extra burden to consumers.

Courtesy of NewAgebd