Fear of Covid testing kit crisis due to duty complication

A number of traders have stopped importing Covid-19 antigen testing kits after the Airport Customs started claiming duty on these products in December last year and health officials fear this might result in a crisis of the kits in the country.

The NBR waived tax on imports of testing kits and personal protective equipment (PPE) since the first wave of Covid-19 hit the country.

On 19 May 2021, the National Board of Revenue published a gazette, exempting testing kits from duty till June this year. That gazette included "Covid-19 test kits based on immunological reactions" on the list of duty-free products.

But, Airport Customs said the rapid antigen test kit cannot be considered as based on immunological reactions, so, it cannot be imported without paying customs duty. Consequently, it has been demanding a 32% duty on antigen testing kit imports since 15 December 2021.

It also sent letters to the traders who had earlier imported antigen testing kits under the duty-free facility.

The Covid-19 testing kits and safety products are exempted from duty, but the antigen testing kit is not, Md Masud Sadiq, member (Customs Policy) of NBR told TBS, adding that he could not make further comment without looking into relevant documents.

The Institute of Epidemiology Disease Control and Research (IEDCR) said the rapid antigen test kits are undoubtedly based on immunological reactions and there is no room for disagreement over the issue.

Gtech Solution Limited, which supplies medical equipment to government organisations, imported five lakh pieces of Covid-19 antigen testing in December last year. The Airport Customs did not allow them to take delivery of their products without collecting Tk1.5 crore as duty.   

Mostofa Al Mahmud, chairman of Gtech Solution Limited, told The Business Standard, "We suffered a heavy blow after paying the duty. We have sent a letter to the National Board of Revenue (NBR) in this regard, but they said they could not withdraw the duty."

Healthcare Diagnostic Solutions Ltd, an importer and supplier of Panbio Covid-19 rapid antigen test kits, said the customs authorities have been demanding duties and taxes on the kits that were imported four-five months ago. They have also imposed embargo on importing new Covid-19 antigen kits.

Md Sadikuzzaman, business coordinator at Healthcare Diagnostic Solutions Ltd, told TBS, "We have been able to import antigen test kits free of duty and sell those to customers at zero VAT invoices. Now if duty and tax are imposed by the customs authorities, its end price will definitely rise, which may have an adverse impact on government initiative to provide low cost Covid-19 test kits to the people."

"Recently the demand for antigen test kits has increased, but we cannot deliver it to the customers. The number of kits needed in three months before is currently needed in 15 days. If such import restriction continues, there will be a crisis of kit in the market," he said.

The government has set Tk700 for antigen testing in private institutions. Experts believe that if customs duties are imposed on the import of kits, the prices will go up further.

Asked about the matter on 26 January, Abu Hena Rahmatul Munim said, "There is no scope for levying duty on products that are exempted from duty. No officer can do that. We will look into the matter in detail."