Stop misuse of bond facilities | 2019-03-14 |

Stop misuse of bond facilities

14 March, 2019 12:00 AM printer

While the bonded warehouse facility was introduced to facilitate export and industrial development, vested quarters continue to exploit it to get undue financial gains largely at the cost of local entrepreneurs. This is also having a negative impact on earnings by the government and the entrepreneurs. What is more worrying is that a large number of local industries, especially the ones that produce paper, are in dire straights.

Though the government allowed import of raw materials – which cannot enter the country's market tax-free – mainly for the export-oriented industries, the unscrupulous quarters are engaged in selling them domestically. They import more that they require and sell off the surplus, secretly and greasing palms of mainly Customs Bond Commissioners.

The country is flooded with illegal goods using the bond facilities, thanks to over-exploitation of the trading provision. The impact of this unholy business has another dimension – local producers are on the brink of extinction.

Local paper factories are facing uneven competition with their combined investment worth about Tk 700 billion. The fear of unemployment of 15 lakh people in the industry is haunting their dependents numbering some 60 lakh. 

According to the National Board of Revenue, the government loses around Tk 60 billion in revenue in the paper sector alone. The market is flooded with the low-quality paper products, imported under the duty-free facility, which are sold in broad daylight at various points of the city under the nose of the law enforcement agencies. Likewise, the trading facility is grossly misused in industries other than the paper industry as well. Thus, the industrialisation of the country is facing a major obstacle.

Though belated, the decision of the revenue board to take a hard line on bond facility misuse is praiseworthy. We urge all to take measures to stop this practice and take stern action against those involved in destroying our local industries.