Govt imposes 1% service charge on car loans for secretaries

The government has imposed a 1 percent service charge on interest-free car loans totalling Tk 3 million for secretaries.

The public administration ministry issued the order in a gazette notification titled ‘Interest-free car advance and transport service encashment policy 2018 (revised)' on Apr 25.  
 
According to the order, government officials with the rank of secretary, additional secretary, joint secretary and deputy secretary are required to pay Tk 30,000 as service charge for interest-free car loans.  
 
The government considered a number of factors, including car maintenance and registration costs, in determining the amount.
 
The government will also provide a monthly allowance of Tk 50,000 for the maintenance of vehicles. 
 
Senior officials such as secretaries, additional secretaries and joint secretaries are recognised as privileged government officials. Deputy secretaries were also included in this list in 2017. 
 
The public administration ministry had previously formulated a gazette notification titled ‘Interest-free car advance and transport service encashment policy 2017 (revised)' in 2017 relating to loans for privileged government officials.
 
According to the gazette notification, officials seeking car loans must remain in their posts for at least one year after the loan is sanctioned. 
 
They would receive loans totalling Tk 3 million to be repaid in 120 equal instalments.  
 
The loan amount will be deducted automatically from their salaries each month. It will be deducted from their gratuity or pension funds should they fail to repay it during their terms in office.