Lift supplementary duty

Ceramic manufacturers have demanded the withdrawal of supplementary duties on tiles and sanitary products at production stage to protect the local firms and recover from the losses caused by the coronavirus pandemic.

Firms pay 15 per cent supplementary duty while selling tiles at the mill gate and 10 per cent duty on sanitary products. There is no supplementary duty on tableware.

The country has to import raw materials such as zirconium silicate, cover coat, printing ink, lavatory seats and covers, flushing equipment, and tank fitting to make ceramic products.

"The production cost has increased by Tk 3 to Tk 5 per kg due to the gas price hike in 2019," said Md Shirajul Islam Mollah, president of the Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA).

He made the comment in his budget proposal to the National Board of Revenue (NBR) in the first week of March.

The government raised gas price by 37.89 per cent for industrial use in July 2019. The gas price hike increased the cost of ceramics production by 10 per cent, industry people said.

Mollah said the ceramic sector had high potential. But, the sector is competing with foreign firms that have better technology, raw materials, and equipment whereas Bangladesh is dependent on the import of raw materials and technology.

Against this backdrop, he demanded an adjustment of the weight of moisture and reduction in customs duty.

He urged the NBR to stop under-invoicing during the import of finished products to save the local industry.

Irfan Uddin, general secretary of the BCMEA, said the sector would face long-term challenges in its efforts to restore the business as consumers tend to avoid purchasing luxury items during the pandemic.

"The government should reduce the supplementary duty at the production level to protect domestic industry and enhance the competitiveness of domestic producers," he noted.

He said the sector would be able to recover from the losses faced during the pandemic if the government extends policy support.

Exports dropped by around 60 per cent in the last fiscal year because of the pandemic-induced collapse in sales globally.  Local suppliers cater to around 80 per cent of the domestic demand. Bangladesh currently holds 0.14 per cent share of the global market for ceramic products.