The National Board of Revenue (NBR) plans to gradually reduce the country’s overall duty structure as Bangladesh moves towards its Least Developed Country (LDC) graduation, said NBR Chairman Md Abdur Rashid Khan on Tuesday.
Speaking at a pre-budget meeting at the Revenue Building, he emphasised that duties could no longer be imposed arbitrarily. “We cannot impose duty at will anymore, so we will reduce this duty gradually,” he said.
With the country set to lose preferential trade benefits post-LDC graduation, the duty adjustments are expected to impact key sectors, including the ready-made garments (RMG) industry, which heavily relies on imported raw materials. The NBR chairman stressed that duty policies would prioritise trade facilitation rather than revenue collection, ensuring that reductions or changes align with national interests and the protection of local industries.
The revenue authority will shift its focus to income tax and Value Added Tax (VAT) as primary sources of revenue collection. Khan also mentioned that VAT rates could be streamlined into a single rate if businesses agreed, a move that could clarify taxation in the RMG sector.
On corporate taxation, he assured that the upcoming budget would include rationalised tax rates. Additionally, tax audits for income tax and VAT files will be automated, with artificial intelligence handling audit selection once the system is fully implemented.
The gradual duty reduction could provide relief to garment exporters, who have long advocated for a more competitive tariff structure on imported textiles and accessories. With duty adjustments on the horizon, stakeholders in the RMG sector will be watching closely to assess how these changes influence production costs and global competitiveness.
