Ministry suggests NBR give tax benefits for local car industry

A file photo shows vehicles stuck in a traffic jam in Dhaka. The industries ministry has requested National Board of Revenue to formulate an investment-friendly tax policy for the automobile industry having the potential for growth to encourage domestic production and assembling of motor cars in the country. — New Age photo

The industries ministry has requested National Board of Revenue to formulate an investment-friendly tax policy for the automobile industry having the potential for growth to encourage domestic production and assembling of motor cars in the country.
In a letter to NBR chairman Md Mosharraf Hossain Bhuiyan, the ministry on December 17 made the recommendation that tax benefits at local production and supply stages and on import of raw materials and spare parts for the sector should be given.
Such policy with necessary tax benefits will attract both domestic and foreign direct investment in the sector, it said.
The ministry made the proposal following an instruction of finance minister Abul Maal Abdul Muhith.
Earlier, Muhith on an application submitted by PHP Automobiles Ltd, a sister concern of PHP Family, commented that it was time for the automobile industry.
PHP Automobiles Ltd sought reduction in duties and taxes for motor car production and assembling in the country and formulation of an investment-friendly tax policy for the sector.
Muhith said that Federation of Bangladesh Chambers of Commerce and Industry could be invited for giving opinions on the issue.
The opinions, if there is any, of the commerce ministry and industries ministry could also be considered, he said.
PHP in its application mentioned that it set up a complete automobile assembling factory in the country with technical assistance of Malaysia-based Proton Holdings Berhad, manufacturer of Proton car, considering the government’s steps positive to develop heavy industry in the country.
The company has invested Tk 300 crore and is now selling locally made brand new Proton PHP cars in the domestic market.
It has been facing uneven competition in marketing the cars due to the existing duty structure which heavily favours car import, PHP claimed.
PHP Family chairman Sufi Mizanur Rahman, however, declined to comment on the issue.
Officials of NBR said that the government was positive about framing a policy for the automobile industry and the issue was discussed in the preparation period of the budget for this fiscal year.
NBR has already framed a policy for the motorcycle manufacturing industry and hopefully, similar policy will come for the motor car industry in future, they said.
NBR chairman Md Mosharraf Hossain Bhuiyan in April, 2018 declared that it would give special facilities to local automobile manufacturers and assemblers to encourage domestic production of high-value products to create jobs in the country and discourage imports.

Source: New Age.

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