New, heavy import tax proposed for Bangladesh newspaper industry

Posted by Simon Day on June 16, 2009 at 2:18 AM

The Newspaper Association of Bangladesh fears the effects of a budget proposal that will impose a five percent import duty on newsprint, Asia Media reported on Sunday. Association leaders, in a statement on Saturday, revealed their distress with the proposed taxation and appealed to Prime Minister Sheikh Hasina for support.

According to the statement the intended five percent duty will in fact be around 11.5 percent after VAT and regulatory tax.

The association said that such taxation, on top of the existing 19 percent import cost paid to the state exchequer, would impose a crippling 30 percent duty on the industry.

The finance minister's foundation for the import duties is the consequential benefits for local paper mills. The association says such an argument neglects the newspaper industry and is discriminatory.

Their statement says, "The government cannot reward a few paper mills for their substandard produce and runaway profit while depriving the newspaper industry of similar concessions."

Newspaper publishers said they have continually stressed the substandard quality of local newsprint that costs Tk 8,000 to Tk 10,000 more than the imported newsprint.

The association leaders also claim the renege of the zero tariff on newsprint frustrated the conditions of the implementation of the seventh wage board's recommendations that saw most newspapers raise wages and benefits for staff by 100 percent.

According to the association's President, Mahbubul Alam, the imposition of the duty would be a breach of the government's commitment to the industry.