RMG exporters seek withdrawal of HS code

Readymade garments exporters have sought withdrawal of all HS code of raw materials in the bond licence for the sake of quick release of imported raw materials for the apparel sector.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) in two separate letters to the National Board of Revenue (NBR) have demanded the facilities.

HS (Harmonized System) is a standardized numerical method of classifying traded products. It is used by customs authorities around the world to identify products when assessing duties and taxes and for gathering statistics. 

“Mandatory inclusion of HS Code in the bond licence for the import of raw materials of RMG sector has been creating difficulties in releasing the consignment of raw materials.

Due to the difficulties over HS code, the export of products are being hampered by the stipulated deadline of foreign buyers which ultimately is putting bad impact on export”, BGMEA said in the letter.

As of their view, export-oriented apparel makers import duty-free raw materials under the bond facilities. Raw materials under the bond facilities get released through customs authority fixed entry book and entry of ASYCUDA World System.

With that, there is no chance of irregularities and dodging tax as Customs Bond Commissionerate scrutinizes the documents and audit report.

While mentioning the problems they are facing over the HS code for import of raw materials, BGMEA and BKMEA said that

H.S Codes change and add on a regular basis there are more than thousand types of HS codes for apparel raw materials basing on their types. 

Besides, buyers place requirements of some new variant accessories for bringing innovation and design and for that new HS Codes need to be included for the new types of materials every time.

In a bid to do that, apparel makers have to face delay in the entire process and often count port demurrage.

“Cost of doing business is increasing. Our exporters are losing export competitiveness while many are not being able to take orders due to HS code related bond difficulties”, they said in the letter.

It is to mention that the government is in strict mode over the monitoring of bond licence as export oriented apparel makers abuse the government provided bond facilities.

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