Bangladesh’s paper manufacturers have urged the government to raise the minimum customs valuation of imported finished paper, saying widespread under-invoicing is depriving the exchequer of revenue and putting a nearly Tk1 lakh crore domestic industry under mounting pressure.
In a letter submitted to National Board of Revenue (NBR) Chairman on 8 July, the Bangladesh Paper Mills Association (BPMA) proposed fixing the Minimum Assessable Value (MAV) of imported finished paper at $945 per metric tonne, arguing that importers are declaring significantly lower prices that do not reflect production costs or international market values.
The industry body also requested the government to prohibit imports of paper matching the specifications used by the National Curriculum and Textbook Board (NCTB), saying Bangladeshi mills are capable of producing those grades for textbook printing.
According to BPMA, paper manufacturers import pulp, the principal raw material, at around $630 per metric tonne. After adding conversion costs such as electricity, gas, chemicals, labour and machinery depreciation, estimated at $315 per tonne, the production cost of finished paper reaches about $945 per metric tonne.
The association alleged that some importers are declaring finished paper at only $600 per metric tonne, enabling them to pay substantially lower customs duties than would be payable on the product’s actual value.
To support its claim, BPMA attached a copy of a recent letter of credit showing the import of 500 air-dried metric tonnes (ADMT) of bleached hardwood kraft pulp by Amber Super Paper Ltd at $630 per ADMT. The association said the document demonstrates that the raw material alone costs more than the declared value of some imported finished paper, making such declarations commercially unrealistic.
Based on the current effective import duty incidence of 64.25%, paper valued at $945 per tonne should generate customs duty of about $607 per tonne, the association said. By contrast, paper declared at $600 per tonne generates only $385 in duty, creating a revenue gap of $222 per tonne.
Assuming imports of 20,000 metric tonnes, BPMA estimated that the government is losing around $44.4 lakh, equivalent to about Tk55.06 crore, in customs revenue.
The association said the impact extends beyond tax collection, arguing that under-valued imports have eroded the competitiveness of local manufacturers by allowing imported finished paper to enter the market at artificially low prices.
According to BPMA, the domestic paper industry has attracted nearly Tk1 lakh crore in investment, directly employs around 10 lakh workers and supports the livelihoods of another 50 lakh people indirectly.
It claimed that 80 paper mills have already shut down, while another 26 are on the verge of closure, warning that continued under-invoicing could further reduce production, threaten employment and discourage future investment.
The association also urged the NBR to ban imports of 29.5-inch roll, 20/30 sheet and 70 GSM and 80 GSM Off-White Natural Shade Printing Paper used by the NCTB for textbook production.
It submitted copies of the board’s technical specifications, arguing that these grades are already manufactured domestically and therefore should not be imported for government textbook printing.
In its appeal, BPMA called for immediate policy intervention, saying a higher minimum assessable value would help ensure fair tax collection, restore a level playing field for domestic producers and protect local manufacturing capacity.
