Bangladesh’s Ceramic Manufacturers Demand Higher Tariffs On Imported Tiles And Sanitary Ware

Bangladesh’s Ceramic Manufacturers Demand Higher Tariffs On Imported Tiles And Sanitary Ware

Ceramic manufacturers in Bangladesh have recently demanded the removal of the surcharge on local tile and sanitary ware manufacturers and an increase in import tariffs on tiles and sanitary ware.

According to a report in the Financial Express, the Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA), at a press conference on the national budget for the new fiscal year (2021-2022), raised the demand for higher tariffs on imported foreign tiles and sanitary ware to protect the local industry.

Currently, Bangladesh levies a 15% surcharge and 10% VAT on local tiles and sanitary ware respectively.

BCMEA believes that encouraging the importation of foreign titles has hindered the development of the local ceramic industry. The country’s SRO policy 161-Act / 2021/158-Mushak provides for a 15 percent surcharge and 15 percent VAT on local ceramic manufacturers only. Imported tiles and sanitary ware dealers are not included in this policy and are therefore exempt from both taxes.

Currently, there are 68 ceramic manufacturers in Bangladesh with local and foreign investments of around Tk90 billion (Rs6.9 billion), including 20 tableware factories, 30 tile factories and 18 sanitary ware factories. In 2019, the market for ceramic products in the country will be around Tk350 billion (Rs26.7 billion).

According to the Bangladesh Export Promotion Bureau, the pandemic had a major impact on the country’s ceramics industry in 2020, with total exports of various ceramic products shrinking by 59.45% to US$27.97 million (Rs180 million) from US$68.97 million (Rs440 million) in the previous fiscal year.

Bangladesh’s main competitors are China and India, and with the global financial crisis and rising labor costs, many developed countries are placing more orders with low-cost producing countries such as Bangladesh. China has the largest market share in the global ceramics market and performs particularly well in the EU market. However, China has increased its export tariffs on ceramic products, making Chinese ceramics more expensive and paving the way for Bangladesh to grab market share in ceramics.

Currently, Bangladeshi ceramics are exported to more than 50 countries including the USA, Jaina, Japan, Poland, India, Indonesia, Croatia, Romania, Turkey, Russia, Spain, Norway, New Zealand, Denmark, Italy, Australia and the UK.

Notably, according to a report in the Financial Express on May 8, the country will regulate tariff preferences under bilateral, regional and multilateral trade agreements. According to the report, the Bangladesh government plans to implement new regulations on the administration of tariff preferences in the new fiscal year (2021-2022). After the new regulations come into effect, importers must submit certificates of origin, the date of issue of the certificate and other relevant supporting documents when applying for tariff preferences.

Customs officials may refuse to grant tariff concessions to imports if the goods submitted by the importer are incomplete, do not comply with the appropriate rules of origin procedures, or do not meet the criteria for tariff concessions. In addition, importers are required to retain information relating to the certificate of origin for a period of five years and to provide such information whenever required by customs officials.