Bangladesh, a rapidly developing South Asian nation, has a structured and dynamic customs tariff regime designed to regulate imports, protect local industries, and generate significant government revenue. The country’s import policies are guided by the National Board of Revenue (NBR), which oversees the application of tariff rates based on product categories and the origin of goods. As an emerging economy, Bangladesh relies heavily on imported raw materials, capital goods, and consumer products to sustain its economic growth, while imposing protective tariffs on certain sectors to encourage domestic production.
Custom Tariff Rates by Product Category in Bangladesh
1. Agricultural Products
Agriculture remains a vital sector for Bangladesh, employing a large portion of the population. The government has established a balanced tariff regime for agricultural imports, combining low tariffs on essential items and higher rates for products that can be domestically produced, in order to protect local farmers.
1.1 Basic Agricultural Products
- Cereals and Grains: Bangladesh imports a significant portion of its wheat, corn, and rice. The tariff rates for these staples vary depending on local production levels and market needs.
- Wheat and corn: Typically subject to 5% to 10% import duty.
- Rice: Depending on the type and season, import duties range from 5% to 25%, with lower tariffs applied during times of local shortages.
- Fruits and Vegetables: Fresh produce is often imported to meet domestic demand. The tariff structure encourages local production of certain fruits and vegetables.
- Apples and grapes: 20% to 25% tariff.
- Onions and garlic: Subject to 15% to 20% duty.
1.2 Livestock and Dairy Products
- Meat and Poultry: Bangladesh imports a portion of its meat, particularly beef, chicken, and mutton. To protect local farmers, the government applies tariffs of 20% to 30% on imported meat.
- Fish and Seafood: Imported fish and seafood face tariffs between 10% and 15%, with higher rates on processed seafood to support the domestic fishing industry.
- Dairy Products: Dairy products such as powdered milk, cheese, and butter are subject to 20% to 30% tariffs, with lower rates applied to essential milk powder.
1.3 Special Import Duties
Bangladesh maintains preferential trade agreements, such as the South Asian Free Trade Area (SAFTA), which allows certain agricultural products from member countries to be imported at reduced or zero tariffs. Additionally, Least Developed Country (LDC) status under the World Trade Organization (WTO) grants Bangladesh preferential treatment, including lower tariffs for exports and imports with certain countries.
2. Industrial Goods
Industrial goods are critical to Bangladesh’s expanding economy, especially in sectors such as construction, manufacturing, and textiles. Tariffs on industrial products vary based on whether the goods are finished products or raw materials used in domestic manufacturing.
2.1 Machinery and Equipment
- Industrial Machinery: To support the growth of local industries, Bangladesh imposes low tariffs (1% to 5%) on machinery used in manufacturing, construction, and textiles.
- Textile machinery: 1% to 3% duty to promote the country’s booming textile sector.
- Construction machinery: 5% to 10% tariff, with lower rates for equipment necessary for infrastructure development.
- Electrical Equipment: Electrical machinery and equipment such as generators, transformers, and industrial electronics are subject to 5% to 15% tariffs.
2.2 Motor Vehicles and Transportation
Bangladesh imports a wide range of motor vehicles, from passenger cars to commercial trucks. Tariffs on vehicles are relatively high to protect the local vehicle assembly industry and reduce environmental impacts from high emissions.
- Passenger Vehicles: Import tariffs on passenger cars vary depending on the engine size and type.
- Small vehicles (under 1,500cc): Tariffs range from 60% to 120%.
- Luxury cars and large-engine vehicles: Can face duties of up to 300%, including supplementary and regulatory duties.
- Commercial Vehicles: Trucks and buses generally attract tariffs between 25% and 50%, depending on the vehicle’s purpose and size.
- Vehicle Parts and Components: Auto parts such as engines, tires, and batteries are subject to tariffs of 10% to 25%, with preferential rates for parts used in the local assembly industry.
2.3 Special Import Duties for Certain Countries
Bangladesh has trade agreements with various countries that reduce tariffs on certain industrial goods. For example, under SAFTA, industrial machinery imported from member states such as India and Nepal may enjoy lower tariffs. Additionally, Bangladesh’s WTO commitments provide for reduced tariffs on industrial goods from member countries.
3. Textiles and Apparel
Bangladesh is one of the world’s largest exporters of textiles and apparel. As a result, the government maintains relatively low tariffs on raw materials and higher duties on imported finished garments to protect its domestic industry.
3.1 Raw Materials
- Cotton and Yarn: Bangladesh imports a large portion of its cotton and synthetic yarn, with low tariffs (1% to 5%) applied to ensure the competitiveness of the domestic textile industry.
- Cotton imports: Typically face a 5% tariff.
- Synthetic fibers and yarns: Attract duties of 1% to 3%.
3.2 Finished Clothing and Apparel
- Clothing and Apparel: Finished garments imported into Bangladesh face higher tariffs, usually ranging from 25% to 50%, to protect the local apparel manufacturing sector.
- Casual wear and sportswear: Generally taxed at 30% to 40%.
- Luxury clothing: Higher tariffs of 50% or more may apply to premium brands.
3.3 Special Import Duties
Textile and apparel imports from SAFTA member countries, such as India, Pakistan, and Sri Lanka, may benefit from reduced tariffs or duty-free quotas under regional trade agreements. Additionally, Bangladesh has preferential access to European markets under the EU’s Generalized Scheme of Preferences (GSP), allowing Bangladeshi textiles to enter EU markets with zero tariffs.
4. Consumer Goods
Bangladesh imports a wide variety of consumer goods, including electronics, household items, and food products. The tariff structure on these goods reflects the government’s desire to balance consumer access to affordable products with the need to protect local industries.
4.1 Electronics and Home Appliances
- Home Appliances: Large home appliances such as refrigerators, washing machines, and air conditioners are typically subject to import duties of 25% to 40%.
- Refrigerators: Generally taxed at 30%.
- Air conditioners: Typically face 35% to 40% tariffs.
- Consumer Electronics: Electronics such as televisions, smartphones, and laptops generally face tariffs of 20% to 35%.
- Televisions: Imported with a 25% tariff.
- Smartphones and laptops: Attract duties of 15% to 20%.
4.2 Furniture and Furnishings
- Furniture: Imported furniture, including home and office furniture, is subject to tariffs ranging from 30% to 40%.
- Home Furnishings: Items such as carpets, curtains, and home décor products are typically taxed at 20% to 30%.
4.3 Special Import Duties
Consumer goods from SAFTA countries may benefit from reduced tariffs, while products from countries with free trade agreements or preferential access under WTO rules may also enjoy lower duties. For example, India and Sri Lanka benefit from lower tariffs on certain consumer products exported to Bangladesh.
5. Energy and Petroleum Products
Bangladesh imports a significant portion of its energy needs, particularly petroleum and gas. The government applies tariffs and taxes to these imports to ensure a stable supply while generating revenue.
5.1 Petroleum Products
- Crude Oil: Import duties on crude oil are relatively low, generally 5% to 10%, to maintain affordability.
- Refined Petroleum Products: Tariffs on refined petroleum products, such as gasoline, diesel, and aviation fuel, typically range from 10% to 25%, with higher rates for luxury fuel products.
5.2 Renewable Energy Equipment
- Solar Panels and Wind Turbines: To promote renewable energy, Bangladesh applies low or zero tariffs on renewable energy equipment, including solar panels and wind turbines, in line with its green energy goals.
6. Pharmaceuticals and Medical Equipment
Bangladesh’s pharmaceutical sector is a rapidly growing industry, and the government applies protective tariffs on certain imported medicines and medical equipment to encourage domestic production while ensuring access to essential healthcare products.
6.1 Pharmaceuticals
- Medicines: Basic medicines are generally subject to zero or low tariffs (5% to 10%) to ensure affordability. Higher tariffs may apply to non-essential or luxury pharmaceuticals.
6.2 Medical Devices
- Medical Equipment: Medical devices such as diagnostic tools, surgical instruments, and hospital beds typically face tariffs between 5% and 15%.
7. Special Import Duties and Exemptions
Bangladesh implements various special import duties and exemptions to protect local industries while promoting trade with specific countries.
7.1 Special Duties for Non-SAFTA Countries
Imports from non-SAFTA countries, such as China, the United States, and Japan, are subject to the standard tariff rates as outlined by the NBR. For example, products from China face regular tariffs, though Bangladesh’s participation in China’s Belt and Road Initiative (BRI) may eventually lead to reduced tariffs on certain products.
7.2 Bilateral and Multilateral Agreements
Bangladesh benefits from several preferential trade agreements that reduce tariffs on goods from specific countries or regions, including:
- South Asian Free Trade Area (SAFTA): Reduced tariffs on goods traded among SAARC member states, including India, Pakistan, Sri Lanka, and others.
- EU’s Generalized Scheme of Preferences (GSP): Allows for zero tariffs on many goods exported from Bangladesh to EU countries.
- Bilateral Agreements: Bangladesh has signed bilateral trade agreements with countries like India, which allow for duty-free or reduced tariff rates on certain goods.
Country Facts
- Official Name: People’s Republic of Bangladesh
- Capital City: Dhaka
- Largest Cities:
- Dhaka (Capital and largest city)
- Chittagong
- Khulna
- Per Capita Income: Approx. $2,554 USD (2023 estimate)
- Population: Approx. 171 million (2023 estimate)
- Official Language: Bengali (Bangla)
- Currency: Bangladeshi Taka (BDT)
- Location: South Asia, bordered by India to the west, north, and east, Myanmar to the southeast, and the Bay of Bengal to the south.
Geography of Bangladesh
Bangladesh is located in the northeastern part of South Asia, covering an area of approximately 148,460 square kilometers. The country is characterized by its lush greenery, vast river systems, and coastal plains, making it one of the most fertile regions in the world.
- Rivers: Bangladesh is crisscrossed by over 700 rivers, with the Ganges (Padma), Brahmaputra (Jamuna), and Meghna being the largest rivers.
- Terrain: The country is predominantly flat, with low-lying floodplains and deltas formed by the rivers. There are some hilly areas in the Chittagong Hill Tracts in the southeast.
- Climate: Bangladesh has a tropical monsoon climate, with hot, humid summers and heavy monsoon rains.
Economy of Bangladesh
Bangladesh has experienced rapid economic growth over the past two decades, transitioning from an agriculture-based economy to one driven by manufacturing, services, and exports. The country’s economic policies focus on industrialization, exports, and infrastructure development.
1. Textiles and Apparel
Bangladesh is the second-largest exporter of garments in the world, after China. The textile and apparel sector contributes approximately 85% of the country’s total exports and employs millions of workers, primarily women. The government has implemented favorable policies to boost this sector, including low tariffs on raw materials and incentives for foreign investment.
2. Agriculture
Agriculture remains an essential part of Bangladesh’s economy, employing nearly 40% of the workforce. Key agricultural products include rice, jute, tea, and fish. The government has taken steps to improve agricultural productivity through subsidies, low tariffs on inputs, and rural development programs.
3. Remittances and Services
Remittances from overseas workers play a critical role in Bangladesh’s economy, contributing significantly to foreign exchange reserves. The services sector, including banking, telecommunications, and information technology, is also growing rapidly and is expected to contribute more to the country’s GDP in the future.
4. Infrastructure Development
Bangladesh is investing heavily in infrastructure development, including new power plants, bridges, and ports, to support industrial growth and urbanization. Projects like the Padma Bridge and new special economic zones (SEZs) are expected to further drive economic growth in the coming years.
