The National Board of Revenue (NBR) plans to introduce a system to prevent the open market sale of items imported under bond facilities.
The revenue collection authority's 'Bond Automation' initiative is part of its plan to stop the illegal practice that is causing the national exchequer a huge loss in duty and taxes, official sources said.
Under the bonded warehouse system, they said, export-oriented industries can import duty-free fabrics. Licences are given to import raw materials without any duty charges against a commitment to export the finished products, which makes exports more competitive.
It is a useful facility for export-oriented industries, especially garment factories, and help reduce lead-time and keep product prices competitive.
According to Dhaka Customs Bond Commissionerate, 90 per cent woven items, 45 per cent garment accessories and 35 per cent knit items are imported under the bond system for the RMG sector. The remaining demand is met locally.
Unscrupulous businessmen misuse the bonded warehouse facility by selling duty-free imported goods in the local market, instead of using them in their own production line.
"We want to control duty and tax evasion practices," a senior NBR official told UNB. "We're at the preliminary stage [of setting up the system] but research is being done."
The official said the automation system would help them track materials imported under bond facilities.
Local traders have long been urging NBR to punish those who misuse the bonded warehouse facilities.
An IT farm has been tasked with finding more about bond facilities in different countries. The farm will place their findings to NBR along with recommendations.
Currently, seven preventive teams of Bond Commissionarate are working in Dhaka. They found 40 companies flouting the facilities in last one and a half month. The rules violation deprived the state of an estimated Tk 30 crore in duty and tax.
Licence holders sometimes use fake addresses to escape the monitoring mechanism, while some deliberately neglect maintaining records of their export and import activities.
Currently, the number of bond licence holders is 6,565. But due to irregularities, licenses of 1,757 entities have been suspended.
Goods procured under the facility are stored in the bondholders' warehouses. If importers fail to export them, they have to pay duty charges and taxes for the rest of the goods imported, reports UNB.