Customs System in Bangladesh: A Comprehensive Overview
1. Introduction
Customs in Bangladesh refers to the system of regulating imports and exports, collecting customs duties, and enforcing laws related to the cross-border movement of goods. It is a vital component of the country’s trade and taxation framework, ensuring compliance with international standards while safeguarding revenue and protecting domestic industries.
The National Board of Revenue (NBR) under the Ministry of Finance is responsible for customs administration in Bangladesh.
2. Legal Framework
The customs system in Bangladesh is governed by the following:
The Customs Act, 1969 (main legislation for customs control, import/export rules, and duty collection).
Import Policy Order and Export Policy Order (updated periodically).
SROs (Statutory Regulatory Orders) issued by NBR for tariff changes, exemptions, and incentives.
International Trade Agreements (WTO rules, SAFTA, APTA, bilateral treaties).
3. Functions of Customs in Bangladesh
The Bangladesh Customs Department performs several key functions:
Revenue Collection
Customs duties, Value Added Tax (VAT), Supplementary Duties (SD), and other charges on imports/exports.
Trade Facilitation
Simplifying procedures for importers/exporters.
Promoting faster clearance through automation and digital systems.
Border Protection & Security
Preventing smuggling, illegal imports, and export of restricted goods.
Enforcing intellectual property rights and preventing counterfeit goods.
Implementation of Trade Policies
Ensuring compliance with national trade policies, restrictions, and quotas.
Protecting Local Industries
Imposing tariffs and duties on imports to protect domestic production.
4. Customs Duty Structure in Bangladesh
Customs duties in Bangladesh vary depending on the nature of goods:
Basic Customs Duty (BCD): 1% – 25% (depending on product type).
Regulatory Duty (RD): 3% – 50% (levied on certain goods to control import volume).
Supplementary Duty (SD): Imposed on luxury/harmful items (cigarettes, alcohol, etc.).
Value Added Tax (VAT): Standard 15% applied on imports.
Advance Income Tax (AIT): Collected at source on imports.
Advance Trade VAT (ATV): 4% in some cases.
5. Customs Procedures in Bangladesh
The customs clearance process typically involves:
Import Declaration
Importer/agent submits a Bill of Entry electronically via ASYCUDA World (Automated System for Customs Data).
Risk Management & Assessment
Goods may go through Green Channel (low risk, immediate release), Yellow Channel (document check), or Red Channel (physical inspection).
Payment of Duties & Taxes
Assessed duties are paid electronically.
Examination & Clearance
Goods inspected (if necessary) and released for delivery.
Export Procedures
Exporters submit an Export Declaration Form (EDF).
Customs ensures compliance with export policies and foreign exchange regulations.
6. Customs Exemptions and Incentives
The government provides exemptions to encourage specific sectors:
Export-oriented industries (RMG, IT, leather, etc.) enjoy duty-free imports of raw materials under bonded warehouse facilities.
Special Economic Zones (SEZs) and Hi-Tech Parks receive VAT, customs duty, and tax exemptions.
Import of certain raw materials, capital machinery, and essential commodities is duty-exempt or reduced to support industrial growth.
7. Customs Administration & Modernization
Bangladesh Customs has adopted reforms to improve efficiency:
ASYCUDA World System for electronic submission and clearance.
National Single Window (NSW) project for integrated trade documentation.
Authorized Economic Operator (AEO) Program for trusted traders.
Introduction of Electronic Fiscal Devices (EFDs) for transparency.
Alignment with WTO Trade Facilitation Agreement (TFA) commitments.
8. Major Customs Offices in Bangladesh
Key customs houses and stations include:
Chattogram Customs House (largest, handling ~80% of imports/exports).
Dhaka Customs House (airport and inland trade).
Benapole Customs House (largest land port with India).
Mongla Customs House (second seaport).
Customs Excise & VAT Commissionerates across regions.
9. Enforcement Role
Bangladesh Customs also acts as a law enforcement authority by:
Preventing smuggling of gold, drugs, arms, and counterfeit goods.
Monitoring cross-border trade and money laundering activities.
Cooperating with Interpol, WCO, and other international agencies.
10. Challenges in Customs System
Complex tariff structure and frequent policy changes.
Corruption and under-invoicing issues.
Delay in full automation and digital integration.
Capacity building and training for customs officials.
Balancing trade facilitation with border security.
11. Recent Developments
Full implementation of ASYCUDA World across all customs stations.
Steps towards paperless trade through the National Single Window.
Modernization of tariff codes in line with HS Code 2022.
Strengthening of bonded warehouse facilities to support export-led industries.
Increased focus on risk-based customs inspections.
✅ Summary
Customs in Bangladesh plays a critical role in trade regulation, revenue collection, and national security. With a mix of duties, VAT, and supplementary charges, customs ensure revenue for the government while protecting local industries. Although challenges remain, the adoption of digital systems like ASYCUDA World and initiatives such as the National Single Window are paving the way for a more efficient, transparent, and globally competitive customs system.