Laptop, aircraft engine prices to drop

Finance Minister AH Mahmood Ali proposes a VAT waiver for the products in the budget for FY25

The prices of laptops are likely to drop as the budget for fiscal year 2024-25 has proposed a waiver on value added tax (VAT) for the product along with aircraft engines and propellers.

Finance Minister Abul Hassan Mahmood Ali proposed the VAT waiver in the two sectors in the budget for FY25 on Thursday.

In the budget address, he said, “I am proposing to increase the customs duty for laptops from 5 percent to 10 percent in order to build a Smart Bangladesh envisaged by our government. We also need to make laptop computers and similar products available to the tech-savvy workforce by curbing the fake and refurbished laptops mushrooming in the market.

“I am also recommending waiving the 15 percent VAT applicable at import stage. This will reduce the total tax incidence from 31 percent to 20.50 percent.”

Proposing a VAT withdrawal to help domestic airlines, the finance minister said, “The domestic airlines are gradually lagging behind in the competition with the foreign ones.

“In order to support the growth of local aviation companies and to tap the future potential of the industry, I propose to withdraw the VAT on aircraft engine and spare parts of propellers at the import stage.”

Proposing a drop in the duty for chillers, an essential capital equipment in various industries, the minister said: “A total duty of 104.68 percent is applicable on the import of chillers which is not conducive for the related industries. I propose to waive all other taxes except 5 percent of customs duty and advance income tax for importing chillers having a capacity of 50 tonnes or more.”

Proposing a balance in the duty for ordinary and pre-paid kilowatt hour metres, Mahmud Ali said: “There is a difference in total tax incidence between imported ordinary and pre-paid smart kilowatt hour metres. As they are similar products and serve the same purpose, I propose to fix import duty at 25 percent for both types of products. Similarly, I propose to fix import duty on pre-paid kilowatt metre parts at 15% for parity.”