Govt mulls temporary tax-free import of sample goods

The government plans to sign an international convention to facilitate temporary import of samples of goods and equipment for fairs and other short-term use, said an official of the National Board of Revenue.

If the treaty -- ATA Carnet System -- is signed, the NBR will allow duty- and tax-free import of samples of certain products, equipment and machinery, temporarily, on condition of re-export. 

"We are in discussion with various stakeholders to select the items for temporary imports," the NBR official said. 

Currently, the NBR grants such import against bank guarantees of up to 150 percent of applicable duties on the specific items. In case of non-return of the goods, the customs authority confiscates the bank guarantee in favour of the state.

But under the ATA Carnet System, customs authorities will grant temporary import permission for entry of commercial samples, professional equipment, and samples for display at international fairs on condition of return or re-export of the items within a stipulated time.

The samples of the products will be allowed zero-duty entry, based on guarantee issued by a local trade body, which will take responsibility of duties in case of non-return of the goods or any misuse of the benefit by importers.

"We want to provide the scope to facilitate trade. It appears that there will be no effect on the state's revenue collection. But the opportunity may benefit certain sectors," the NBR official said. 

The government had much earlier decided in principle to sign the ATA Carnet system. However, the process was slowed owing to a delay in selecting the trade body that would vouch for the importers, according to the meeting minutes on the ATA Carnet. 

"It is mainly because of differences in opinion between the Federation of Bangladesh Chambers of Commerce and Industry and the International Chamber of Commerce-Bangladesh. Both the chambers want to get that responsibility," the official said.

The need to sign the convention was felt after the signing of the Trade Facilitation Agreement (TFA) at the WTO Bali conference. Bangladesh is in the process of ratifying the TFA. "So, we need to facilitate trade as a WTO member."

The ATA Carnet system is also used in Bangladesh's neighbouring countries, such as India, Sri Lanka, Pakistan, Thailand and Malaysia. 
"We have also examined the types of products that are given ATA Carnet facility in those countries," he said, adding that the revenue authority plans to finalise the products and select a trade body that will issue guarantees for temporary imports.

After finalisation, the NBR will request the foreign ministry to initiate signing the ATA Carnet, the official said.