New NBR steps to expedite bond facilities
There will be no scope for delaying in providing customs bond-related services from now on, says NBR officials
Aimed at addressing exporters' allegation of delays and harassment in availing bond facilities, the National Board of Revenue (NBR) has moved to undertake a new set of steps, including a revised deadline to process applications.
The new directive limits processing time of exporters' applications regarding 25-types of bond related services from two to 17 working days. Besides, the list of documents, required to file with the application, have also been specified.
On 17 November, the customs department of the revenue board issued two directives in this regard, which was welcome by both exporters and economists.
Terming it as exemplary, NBR officials have said, there will be no scope for delaying in providing customs bond-related services from now on.
"This is a positive move," said Dr Ahsan H Mansur, executive director of Policy Research Institute (PRI), and added, "It is a small step. The NBR has a long way to go to make business easier."
Raw materials and accessories, imported under duty-free facility, are kept in a specific warehouse of the factory premises designated by the customs department, which is known as bonded warehouse or bond facility.
Most of the main raw materials and accessories of readymade garments, the main export of the country, are dependent on imports. Apart from this, raw materials of plastics and other export products are also import-dependent. Exporters of these industries can import raw materials and accessories with duty free facility.
To avail this facility, exporters have to apply for a license at the Customs Bond Commissionerate under the NBR. For disposal of such an application, applicants need to move to departments and officials including the branch of the concerned customs office, assistant revenue officer (ARO), revenue officer (RO), assistant commissioner or deputy commissioner (AC/DC) and joint commissioner or additional commissioner (JC/ADC)
According to the NBR order, the file of such an application will remain in the respective branch for a maximum of one day. Apart from this, ARO will have three days, RO will have one, two days in the hands of AC/DC, two days for of JC or ADC to process the application. In short, the officials will have a maximum of nine working days to dispose of the related files.
Requesting anonymity, a garment leader told The Business Standard that there are applications which have not been disposed of in one year.
Even if all documents are in order and the 'demands' of the officials are met, it takes two to three months to settle after the application, he claimed.
According to the NBR order, the time limit for resolving an application for issuance of Bond License for Export Processing Zone (EPZ) factory will be nine days.
In the case of garment industry bond licenses, in the light of BGMEA recommendation, a renewal application will be settled within six days, the extension of bond facility application within nine days, ownership change application has to be submitted by nine days, application for addition or subtraction of raw material or export products within six days, and the application for permanent inter-bond transfer to be settled within 13 days.
In addition, the application for waiver of duty on raw materials damaged or destroyed due to natural calamities has to be disposed of within 17 working days.
Apart from this, the time limit has also been fixed for other services.
In the same way, the documents to be submitted in various bond-related activities have been specified in another order. If anything, other than these documents, is required, no lower-level official can ask for it. Only a commissioner or a joint commissioner or an officer of higher rank can ask for it with the permission of the commissioner.
The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) has been working on the issue of bonds for garment exporters for a long time.
Its Executive President Mohammad Hatem told The Business Standard, "We appreciate the NBR's initiative. This is a big step towards making business easier but we have doubts about the effectiveness of this order in the field level because many such previous orders have not been implemented."
Ahsan H Mansur said those who are in business should be given auto-renewal facility. There needs to be an audit post factor so that export activities are not disrupted even if the audit takes place later. A lot of information, which the customs department already has, has to be provided to them. Bonds need to be automated. The NBR still has a long way to go to make business easier.
Customs Bond Commissionerate (CBC) Dhaka Commissionerate Kazi Mustafizur Rahman told TBS that NBR has taken a decision based on our advice. Time constraints will make it easier and faster for bond-license holders to receive services. It will also be possible to keep the officers in check.
According to CBC, Dhaka, there are currently 3,120 institutions having active bond license under this office.
Apart from Dhaka, there is a separate Customs Bond Commissionerate to facilitate the services of Chattogram-based exporters. At present, there are about 1,000 organisations with active bond licenses under that office.