NOAB seeks duty-tax cut amid industry crisis

The Newspaper Owners' Association of Bangladesh (NOAB) has demanded the withdrawal of various duties and taxes on different components linked to newspaper production, taking into consideration the hardships the industry has been facing since the Covid-19 pandemic hit the country.

In a statement issued on Wednesday, a day before the national budget for the fiscal year 2023-24 is to be presented in parliament, the NOAB put forward some issues for the government's consideration in the next budget.

The NOAB said that it had a pre-budget discussion meeting with the National Board of Revenue (NBR), where its chairman pledged to consider the demands of the newspaper industry.

The statement, signed by NOAB President AK Azad, highlighted that in the age of globalisation and digital media, print newspapers have already become a struggling industry.

It pointed out that due to the significant reduction in advertisements and newspaper circulation caused by the Covid situation, it has become impossible to cover production costs with income from advertisements.

The price of imported newsprint was US$ 570 per tonne with an exchange rate of Tk 85 one and a half years ago. Currently, the price of newsprint has exceeded US$ 700 per tonne, and the exchange rate stands at Tk 109.

The statement also mentioned that the current economic situation has exacerbated the industry's challenges.

NOAB said that despite the existing 5.0 per cent duty on newsprint imports, there are additional costs that significantly raise the total landed costs to over 30 per cent. These costs include a 15 per cent value-added tax (VAT), 5.0 per cent advanced income tax (AIT), 5.0 per cent advanced tax, as well as insurance, bank, and transportation expenses.

"NOAB thinks that withdrawal of the duty is very important when the newspaper industry is passing through a crisis situation," reads the statement.

The statement further mentioned that although the newspaper is a service industry, it is classified as a private limited company, unregistered company, and non-residential company, subjecting it to a fixed corporate tax rate of 30 per cent.

Demanding a reduction in the corporate tax rate for the newspaper industry, the NOAB suggested fixing it at 10 to 15 per cent. The NOAB also pointed out that a total of 9.0 per cent tax, consisting of a 4.0 per cent tax deduction at source (TDS) and a 5.0 per cent AIT, is imposed on advertising income. However, many newspaper companies fail to generate a total profit of 9.0 per cent.

Therefore, the NOAB called for a reduction of the TDS on income from newspaper advertisements to 2.0 per cent from the current 4.0 per cent, and the abolition of the AIT on raw materials, citing the current situation.

Furthermore, the NOAB stated that allocating a portion of government incentives to the newspaper industry is necessary to safeguard this sector.