Govt reduces source tax on import of 60 essential commodities

The government has proposed withdrawing source tax on the import of 60 essential commodities, aiming to improve the standard of living of every individual and family in the country.

The proposal is to reduce the source tax rate on various agricultural and consumer products, including paddy, rice, wheat, potatoes, vegetables, ducks and chickens, fish, onions, garlic, ginger, salt, sugar, edible oil, and seeds — from the existing rates of 5 percent, 2 percent, or 1 percent to 0.5 percent.

In recent years, the unchecked rise in commodity prices has caused significant hardship in people's lives. In line with the government's electoral commitment, this measure is expected to provide relief and bring greater comfort to the public.

Bangladesh’s overall inflation climbed to a 16-month high of 9.42 percent in May, driven largely by a sharp rise in food prices that is squeezing household budgets, particularly for low- and middle-income families.

According to data released by the Bangladesh Bureau of Statistics (BBS), food inflation rose to 9.06 percent in May from 8.39 percent in April, reflecting higher prices of essential commodities. Non-food inflation also increased, reaching 9.71 percent from 9.57 percent in April.

Rural areas bore the brunt of the rise, with inflation climbing to 9.48 percent from 9.05 percent the previous month. Urban inflation rose from 9.02 percent to 9.25 percent.

The proposed tax measure by the government may help reduce the prices of these basic commodities and also ease inflationary pressure in the country.