To keep prices within the reach of consumers, the Bangladesh Trade and Tariff Commission has recommended the National Board of Revenue lower import taxes on fresh fruits by at least two-thirds in the upcoming national budget.
Importers now have to pay a total of 89.32% import taxes on orange, apple, malta and grape. The breakdown of the tariffs is – a 25% customs duty, a 20% supplementary duty, a 15% value added tax (VAT), a 5% advance income tax, a 3% regulatory duty and a 5% advance trade VAT.
Most foreign fruits remain pricier throughout the year due to the high import tariffs and relatively low production.
To reduce prices of orange, apple, malta and grape in the domestic market, the commission recommended the National Board of Revenue (NBR) lower the total import tariff to 31% in the 2021-22 fiscal year budget.
Fruit importers and producers say Bangladesh heavily depends on foreign markets to import orange, apple, grape, malta, pomegranate, and pear. Though the country has started growing some of the fruits locally, the import dependency is still more than 90%.
Sirajul Islam, general secretary of the Fruit Importers' Association, told The Business Standard that a cut in import tariffs would also reduce fruit prices making them more available to local consumers with lower incomes.
Authorities concerned said, though the country has started cultivating some of the foreign fruits, the locally grown items do not have much impact on market prices due to low production.
On the other hand, foreign fruits are sold at higher rates throughout the year due to high import tariffs on them. As such, many people still cannot afford buying fruits regularly though the varieties are a great source of nutrition.
According to the Department of Agricultural Marketing, the price of apples, oranges, malta, and grapes, usually ranges from Tk150 to Tk200 per kg in the local market for most of the year. However, at the end of the season, they are sold at a higher price.
Md Asadullah, director general of the Department of Agricultural Extension (DAE), told The Business Standard that the tariff cut of some import-dependent fruits would not hurt local fruit production.
According to the DAE, orange growers and importers, the country's orange production is still less than a quarter of imports. Malta cultivation, on the other hand, is outpacing orange cultivation in Bangladesh.
DAE Horticulture Wing Director, Md Kabir Hossain, told TBS that orange growing is slowly gaining popularity across the country. The import tariffs could be lowered until local production can meet local demand.
According to the DAE's Horticulture Wing and Plant Quarantine Centre, more than 2 lakh tons of apples, 1.5-2 lakh tons of orange, and more than 50,000 tons of grapes are imported every year. However, there was no consistency in malta imports.
Bangladesh grew 40,317 tons of oranges in fiscal year 2019-20, with a 5% annual growth in production.
In 2019-20, 28,041 tons of malta was produced, and production is expected to increase by 15-20% this year.
In 2019-20, the country grew more than 1.23 crore tons of fruits, including fruit typically considered to be foreign.
The foreign varieties include rockmelon, muskmelon, honeydew, and icebox yellow melon, dragon fruit, apple, orange, and grape. The country imported more than 6.26 lakh tons of fresh fruits in fiscal year 2019-20. The imported varieties include apple, orange, grape, pomegranate, Indian gooseberry, dates, cherry, pears, persimmon and mango.