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NBR decides to introduce special stickers
MPs abuse duty-free car import facility
Shakhawat Hossain

          The National Board of Revenue (NBR) has planned to introduce stickers for the duty-free import of luxury cars by the members of parliament (MPs) to curb abuse of the special facility that was launched in 1998.
Misuse of the facility has been on the rising trend in recent years as most of the lawmakers sold the imported cars unofficially to the businessmen under special arrangement with the car dealers, according to a study by the NBR's Central Investigation Cell (CIC).
"To check this illegal practice, the NBR will put the specially designed sticker or tag on the duty-free automobiles imported by the MPs so that no businessman feels encouraged to buy those," said a high NBR official.
When asked, NBR chief Khairuzamman Chowdhury refused to disclose the details of the plan.
He, however, said: "Something should be done to identify those duty-free luxury cars."
Sources in the NBR said the design of the sticker has already been finalised. The non-removable label will be placed on the duty-free imported car once it enters into the country.
Last August, the NBR restricted duty-free import of luxury cars by lawmakers at 3,000cc from 6,000cc and made the import eligible only for those lawmakers, who have served a minimum of two years of parliamentary tenure.
At the same time, the board increased the time-frame for changing the ownership of such cars to four years from the existing three years.
To make this privilege available to the MPs, the government loses out on revenue amounting to Tk 700 million to Tk 750 million each year.
The study conducted by the CIC in November 2004, revealed that luxury car owners that included lawmakers and business leaders had not shown any record of ownership of such vehicles in their tax returns.
The intelligence and research arm of the NBR made the stunning revelation while examining the sales files of luxury cars. It became evident that most luxury cars imported by the lawmakers were sold in the local market without handing over the documents.
The CIC found that any purchase of luxury cars including such exclusive brands as Mercedes Benz, BMW and Lexus price-tagged between Tk 8.0 million and Tk 13 million each was never mentioned in the tax returns of the owners.
Sources said city's luxury car dealers keep paid employees to convince lawmakers to sell their duty-free cars to others. In this case, they added that the dealers paid the import bill and also arranged a third party to sell the car.
This is the most common way of running the business of luxury cars in Bangladesh as it ensures lucrative profits to the dealers.
For example, a tax-paid luxury car will cost Tk 12 million in the local market under the present duty structure, whereas, a similar tax-exempted one would only be Tk 5.0 million for the MPs.
But the luxury cars, which are imported by the lawmakers duty-free, are sold in the local market under deals between lawmakers and car dealers at a very lucrative price to a third party.
Several luxury cars manufacturers, including BMW, Mercedes Benz, Volvo and Lexus appointed official dealers in Dhaka during the last couple of years, they added.
More than 300 luxury cars have been sold out since then.
Famous German automobile manufacturer - BMW - alone sold at least 50 vehicles between US$70,000 to $270,000 apiece within the first six months of its operation in Dhaka in January 2003.


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