SUV cars getting popular

In the proposed budget for the fiscal year 2023-24, a new measure called the 'carbon tax' has been introduced for individuals who own multiple motor vehicles. Under the Finance Bill, this tax will apply to vehicles with engine capacities ranging from 1,500cc or 75kW to 3,500cc or 175kW, excluding certain vehicle types. The tax rates vary based on the engine capacity, with amounts ranging from Tk 25,000 to Tk 0.35 million.

Imports of cars through Chattogram and Mongla ports have surged in the last few months of the current fiscal year, raising concerns among consumer goods importers. In May, a record 2,641 cars were imported from Japan, with 1,009 arriving via Chattogram port and 1,632 through Mongla port. The Bangladesh Reconditioned Vehicles Importers and Dealers Association (Barvida) expects over 800 cars to be imported in June. The increase in car imports is worrying as the country struggles to meet import bills for essential items amidst a dollar crisis.

More than 74,000 registered commercial vehicles, including buses and trucks, in Bangladesh have exceeded their government-set economic lifespan, as reported by the Bangladesh Road Transport Authority (BRTA). A recent circular from the Road Transport and Highways Division (RHD) mandates the scrapping of these vehicles. BRTA data shows that around 36,123 buses and minibuses have surpassed their 20-year economic life, while 38,123 trucks, lorries, and tankers have exceeded their 25-year lifespan.

In Bangladesh, starting from the next fiscal year, people who own more than one car may have to pay an extra charge as a means of protecting the environment. The government aims to discourage excessive vehicle usage in order to combat carbon emissions and air pollution. The proposed surcharge will be based on the engine capacity of the cars and will apply to passenger cars, jeeps, and microbuses. The finance ministry is considering implementing a carbon tax, similar to other countries, as a means of discouraging the growing use of personal vehicles and reducing pollution.

Bangladesh Bank imposed restrictions on the import of luxury goods on July 4, 2022, in an effort to prevent the decline of foreign exchange reserves. The restrictions required importers to pay a 100% cash margin on all luxury goods, including cars, electrical and electronics home appliances, and gold ornaments. However, the restrictions did not have a significant impact on the import of cars. In the 11 months after the restrictions were imposed, 17,509 cars were imported, an average of 1,591 cars per month. This is only slightly lower than the 23,000 cars that were imported in the previous financial year.

Government officials and foreign delegates emphasized the need for local manufacturers to produce certified motorcycle helmets in order to increase accessibility and affordability, ensuring road safety. The World Bank, in collaboration with the Bangladesh government and BRAC, organized an advocacy event to promote the use of standard helmets during the UN Road Safety Week. Currently, all certified helmets are imported, and local manufacturers lack certification from the Bangladesh Standards and Testing Institution (BSTI).