Local poultry industry has sought withdrawal of taxes on import of raw materials used for manufacturing poultry feed as those will enhance the production cost of eggs and meat and affect their supply.
According to poultry industry owners, taxes might increase the production cost of poultry birds, chicks and eggs by nearly 15 per cent and some 15-20 per cent of small poultry farms could face closure.
The finance minister in the national budget for the next fiscal year has proposed a fresh 10 per cent regulatory duty on soya-meal import and 5.0 per cent advance income tax (AIT) on maize import.
He has also proposed increasing supplementary duty on limestone to 25 per cent from current “zero” per cent and customs duty on lysine and its esters import to 10 per cent from current “zero” per cent.
“If taxes are not withdrawn by the finance minister, the country’s poultry sector will be affected severely instead of its expected growth amid the target of extended protein supply by 2021,” said Mashiur Rahman, president of Bangladesh Poultry Industries Central Council (BPICC).
According to poultry industry insiders, maize and soya-meal are key ingredients for producing poultry feed. Nearly 50-55 per cent of ingredients used in manufacturing poultry feed is maize while about 30 per cent is soya-meal.
Almost cent percent of feed is supplied by local producers who import raw materials including maize, soya-meal and other ingredients.
Some 40-45 per cent maize of 2.2 million tonnes of annual demand is supplied by local farmers while 55-60 per cent is imported from overseas markets.
Besides, feed millers import 0.80 million tonnes out of some 1.6 million tonnes of annual demand for soya-meal from overseas market for producing poultry feed.
Mr Mashiur, also president of Feed Industries Association Bangladesh (FIAB), said: “The finance minister in a pre-budget discussion assured us that he will withdraw taxes on soya-meal and maize imports. Rather, new tax (regulatory duty) is imposed on soya-meal import.”
He added: “The government will earn only Tk 2.65 billion from taxes on maize and soya-meal. But if the government withdraws taxes, the poultry industry could supply meat and eggs at reasonable prices.”
President of World’s Poultry Science Association -Bangladesh Branch (WPSA-BB) Shamsul Arefin Khaled said: “If taxes are not withdrawn, the cost of feed will increase by Tk 1.0-Tk 1.50 per kilogram. It will ultimately raise the production cost of day-old chicks, poultry meat and eggs.”
“It is interesting that the government has proposed withdrawal of current 10 per cent customs duty on soya-meal import. But it imposed 10 per cent regulatory duty on it. Under present tax arrangement, we can get waiver of customs duty under SAFTA rules for import from India or any South Asian country. But newly imposed regulatory duty will have no more scope of such tax waiver facilities.”
Source: Financial Express