In a step towards global trade compliance, the National Board of Revenue (NBR) has undertaken a comprehensive review of Bangladesh`s tariff regime, identifying 60 tariff lines where current customs duties and associated charges surpass the bound rates established in the World Trade Organization (WTO) agreements.
As part of its initial measures, customs duties on 6 items have been reduced, signaling Bangladesh`s commitment to aligning its trade practices with international standards.
The initiative, detailed in an official document, sets forth a plan to gradually adjust these rates to fall within the WTO-agreed bound tariffs by 2026. Bound tariffs represent the maximum most-favored nation (MFN) tariff rate a country commits to at the WTO, serving as a ceiling that applied tariffs cannot exceed. This regulatory framework ensures that trade policies remain predictable and stable, providing security for traders and investors.
Countries typically negotiate bound tariffs during their accession to the WTO or through subsequent trade negotiations, setting these rates higher than their applied tariffs to retain policy flexibility. However, exceeding these bound rates without proper adjustments can lead to international disputes and demands for compensation, emphasizing the importance of adherence.
The recalibration effort by Bangladesh reflects a broader trend among WTO members, where developed, developing, and transitioning economies have significantly increased the proportion of imports with bound tariff rates, enhancing global market stability.
Additionally, the government has resolved to eliminate the minimum import price requirement, already removing it from 55 items with a strategic plan to phase it out entirely from the remaining 130 products by 2026. This move aims to simplify the import process and foster a more competitive market environment.
The document outlines a cautious approach to tariff reduction, ensuring that local industries are not adversely affected and that revenue mobilization remains robust.
The NBR`s strategy involves a careful balancing act, prioritizing the protection of domestic sectors while advancing the country`s export competitiveness.
This progressive adjustment of customs duties and the abolition of the minimum import price underscore Bangladesh`s efforts to integrate more seamlessly into the global trading system, promoting economic growth and development in alignment with WTO commitments.
