Equal transit fees for all countries
Bangladesh should charge between $4 and $50 for a tonne of goods in transit fees depending on routes chosen by the user, according to a recommendation report of the Tariff Commission on transit.
The rate of charge may be equally applicable to India, Nepal and Bhutan, it said.
The committee on transit led by Tariff Commission Chairman Mujibur Rahman submitted the report to the commerce ministry last week. The rate will be fixed at an inter-ministerial meeting.
The recommendations were made on the basis of reports of five sub-committees on transit route, charge, volume of traffic, investment, and benefit.
Mujibur Rahman told The Daily Star on Thursday, “We have submitted the report online and recommended the imposition of charge in line with World Trade Organisation rules”. He, however, did not elaborate.
Rahman said it cannot be assessed how much benefit Bangladesh will reap by providing the facility until the transit system is implemented.
On charging fees, the report said, all relevant ministries and agencies such as the National Board of Revenue (NBR), Ministry of Communications and Ministry of Environment, need to sit together under the leadership of the Ministry of Commerce and finalise the transit charge based on a calculation of user charges in different categories.
The report said Bangladesh may negotiate with the countries, which can use transit facility, about the percentage of savings it could receive from them. After settling the amount through discussion, it could be incorporated in the transit charge.
As the fuel surcharge will be paid by only those foreign vehicles that will refuel in Bangladesh petrol stations, it will have to remain outside the purview of transit charge. This surcharge will have to be collected separately at the sales points and it will go to the collection head of VAT wing of NBR, it said.
The Customs Management of Transit and Transhipment Goods Rules, 2010 may be amended so that the "transit/transhipment fee" mentioned in the rules reflect all types of fees and charges that were combined together, it read.
The report said, for ease of collection of fees and reducing hassle of transit traffic, the combined "transit charge" can be collected at a single point, for example, at the time of entry of the transit vehicles at the bordering customs stations.
According to General Agreements on Tariffs and Trade (GATT) and Customs Act, 1969 of Bangladesh, it cannot impose customs duties or tax on transit traffic, it said.
But there are no restrictions on imposing transit charge on the movement of transit traffic in order to recover various types of costs related to administrative expenses such as costs of customs formalities, customs inspection and charge for use of services.
This user charge will also cover various types of external costs associated with transit traffic, such as cost due to congestion, environmental pollution, accidents from the extra traffic, use of fuel, and financial costs of network provision and maintenance.
The report said such fees or charges may also incorporate certain portion of the benefits enjoyed by the countries that are provided with transit facilities.
It cited different studies and said Bangladesh may charge a transit fee for each tonne of Indian, Nepalese, Bhutanese cargo that will travel through the country based on a certain percentage of the savings made by the respective beneficiary country.
Mentioning different transit routes, the report said the savings by India, Nepal or Bhutan could be around 12 to 80 percent depending on the routes they will use through Bangladesh.
The apportionment of the percentage of such savings between the countries involved may be settled through negotiation, the report said.
The government assigned the committee on transit to conduct an extensive study to fix routes and fees, economic analysis of the transit, and assess the volume of traffic before allowing transit to India, Nepal and Bhutan.
The sub-committees included former UN ESCAP director M Rahmatullah, Executive Director of Centre for Policy Dialogue (CPD) Mustafizur Rahman , Vice Chairman of Policy Research Institution and former World Bank official Sadik Ahmed, BIDS Senior Research Fellow Dr Mohammad Yunus.
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