Duty-free car import facility for MPs is cancelled

After three years, 25 percent import duty is being levied on cars imported by MPs. Finance Minister Abul Hasan Mahmud Ali has proposed this in the budget.

Besides, 15 percent VAT has also been proposed at the import level. As a result, the members of Parliament are not fully provided with duty free car facilities. The proposed budget proposes to impose a total of 40 per cent excise and duty on imported cars by MPs.

Regardless of the vehicle MPs bring, they have not had to pay any duty, supplementary duty or VAT since 1988. After three decades, MPs have proposed reining in duty-free car import facilities.

He spoke about this issue in the budget proposal for the financial year 2024-2025 presented in the National Parliament on Thursday (June 6).

The Finance Minister said that everyone is being encouraged to pay revenue to come out of the culture of tax evasion at all levels. To set a shining example of leading from the front as a representative of the people, a slight change in the right of MPs to import cars without paying all kinds of duties and taxes will set a great precedent. For this purpose the provision regarding benefit of duty-tax exemption on import of vehicles may be amended by the Hon’ble Members of Parliament.

For this reason, he proposed to include necessary amendments in the President’s Order ‘The Members of Parliament (Remuneration and Allowances) Order, 1973’.

Generally, car imports are subject to additional import duty ranging from 100 to 500 percent on the total value depending on the type. Apart from this, depending on the engine capacity of the vehicle, various additional duties and VAT have to be paid. Supplementary duty is then levied on the sum of the car price and import duty.

In the 1980s, the then army chief, Lt. Gen. Hussain Muhammad Ershad, gave duty-free import of cars to members of parliament. The caretaker government repealed the provision in 2007. However, since there was no parliament at that time, no one came under this rule. However, in 2009, it was reopened by the Awami League government.