Steel manufacturers in the country on Tuesday urged the government to slash both customs duty (CD) and advance income tax (AIT) on the import of scrap - the key raw material for manufacturing steel - in a bid to help them cope with the rocketing prices of the item in the global market.
At present, the customs duty for scraps is Tk 1,500 per tonne and AIT Tk 800 per tonne.
The Bangladesh Steel Manufacturers Association (BSMA) has requested the government to reduce it as it was not mentioned in the just-tabled proposed budget for the upcoming financial year 2021-22 (FY'22).
A BSMA press release said the Association had requested the government several times before the announcement of the FY'22 budget to curb CD and AIT on scraps, following rising costs of steel in the domestic market as well as the rocketing trend of scraps in the global market.
BSMA Secretary General Md Shahidullah said they had requested the National Board of Revenue (NBR) to lower the customs duty of key raw material 'ferrous waste and scrap' (H S Code: 72.04) and sponge iron (H S Code: 72.03) to Tk 500 and AIT on them to Tk 300, to keep prices of steel reasonable in the country.
He said the production cost of steel rod had increased notably in the last six months following increasing costs of scraps.
The price of each tonne of scrap, which was US $300, now stands at $550, according to Mr Shahidullah.
Bangladesh requires 4.0-4.5 million tonnes of scraps to make billet for manufacturing steel - of the total scraps, more than 90 per cent are imported, according to BSMA.
Price of 60-grade rod shot up to a maximum Tk 74,000 a tonne in June 2021 - a10 per cent hike in a month and 24 per cent in a year, according to the Trading Corporation of Bangladesh (TCB).