As dates prices surge, importers blame high customs valuation, duty

About a week before Ramadan, the market witnessed a surge in the prices of dates. Importers attributed this price hike to the revenue authority, citing significantly increased customs duties on imports this year.

Each year, during Ramadan, demand for dates experiences a notable rise in Bangladesh, as this delicious fruit becomes an indispensable item for daily iftar consumption throughout the fasting month.

The prices of lower-tier dates have nearly doubled this year. According to Shah Mohammad Morshed Quader, a senior agriculture marketing officer in Chattogram district, lower-tier dates are at present retailing at prices ranging from Tk280 to Tk300 per kilogram. In contrast, the previous year saw these varieties of quality dates selling for Tk150 to Tk180 per kilogram.

Importers told TBS that customs duties on imported dates are determined based on customs assessments of their value. However, this year, the customs assessment values have doubled, resulting in tariffs (including customs duty, regulatory duty, and VAT) rising by over 90%. 

For instance, if a particular variety of dates is acquired at Tk65 per kilogram from the international market, customs now assess its value at Tk120, subsequently applying other duties. This escalation in costs per kilogram is consequently leading to higher prices for consumers.

This year, the most affordable date varieties were imported from Iraq, Dubai and Tunisia. These dates typically range in price from Tk65 to Tk74 per kilogram in the international market, but Chattogram Customs House has been assessing their value at Tk120.

Until fiscal year 2022-23, importers noted that the Total Tax Incidence (TTI) on date imports stood at 10%, with an assessment value of $500 per tonne for dates of this quality, resulting in a duty of Tk 5.45 per kilogram. However, in the current fiscal year, the assessment value has doubled, and new customs duty (CD), regulatory duty (RD), and VAT have collectively increased by 48.60%.

Even though beginning from 8 February, the government has reduced customs duty on date imports from 25% to 15%, the prices of dates remain high due to higher valuation, said importers.

Sirajul Islam, president of the Bangladesh Fresh Fruits Importers Association (BFFIA), told TBS that due to the implementation of the new assessment value, dates packaged in PP bags incur duties ranging from Tk5.45 to Tk64.41 per kilogram. Similarly, dates packaged in cartons within dry containers face duties ranging from Tk10.93 to Tk169.97. For dates packaged in cartons within reefer containers, duties range from Tk10.93 to Tk272, while retail-packed dates are subject to duties ranging from Tk21.84 to Tk180.37.

The Consumers Association of Bangladesh said the heightened valuation by customs is disproportionately affecting low-priced dates, subjecting them to higher tariffs. Meanwhile, high-priced dates remain relatively unaffected by the increased valuation. 

SM Nazer Hossain, vice president of the Consumers Association of Bangladesh (CAB), stressed the importance of a careful duty imposition by all relevant agencies, including the National Board of Revenue, to regulate the market for imported products, including dates.

The country's yearly demand for dates amounts to approximately 90,000 tonnes, with 40,000 tonnes needed solely during Ramadan. Chattogram Customs data reveal that 24,960 tonnes of dates were imported via Chattogram port from 1 January to 26 February. 

According to Chittagong Customs House data, around 88,567 tonnes of dates were imported through Chattogram port in 2022 and 68,515 tonnes in 2023. 

Importers said they cannot meet demand due to the dollar crisis, exacerbated by higher-than-actual customs valuation, destabilising the market. Despite appeals to the customs authorities, commerce, and finance ministries for reasonable assessment values, no remedy has been provided. 

Importers, including Shathi Enterprise, Al Barakah Dates Factory BD Limited, Siam Fruits, Safwana Fruits Trading Corporation, and Asian Fruits BD Limited, have expressed these concerns to Chittagong Customs House.

However, Mohammad Fyzur Rahman, Commissioner of Chittagong Customs House, told TBS that the assessment value has been determined on the basis of the price of dates in the international market. Hence there is no scope for making unreasonable demands on the existing assessment value. Around 95% of dates imported around Ramadan have already been cleared.

Import duty has also been reduced by 10%. So there is no chance of any volatility in the market, he added.