How Import Duty Is Calculated in Bangladesh (With a Worked Example)

Ask ten importers in Dhaka how much duty they will pay on a shipment and most will quote one number: the TTI. It is a good starting point, but it is not the amount that ends up on the bank challan. Customs works out each tax separately, on a different base, in a fixed order. Once you understand that order you can estimate your landed cost before you open the LC, and you can check whether the assessment customs hands you is correct.

This guide walks through the calculation step by step with a real example. If you just want the number, use our free import duty calculator, which follows exactly the same method.

Step 1: Work out the CIF value

Bangladesh assesses import duty on the CIF value of the goods: cost, insurance and freight up to the port of entry.

• Cost (FOB value): the price on the commercial invoice.
• Freight: the sea or air freight to Chattogram, Mongla, Benapole or Dhaka airport. If you bought on CFR or CIF terms it is already in the invoice price.
• Insurance: the marine insurance premium. If no insurance value is declared, customs adds a notional amount, commonly 1% of the FOB value.

The total is converted to taka at the customs exchange rate in force on the day your bill of entry is submitted. NBR publishes this rate, and it is usually close to the commercial bank selling rate, not the rate your bank gave you when the LC was opened.

Step 2: Add the landing charge to get the assessable value

Customs then adds a landing charge of 1% of the CIF value. The result is the assessable value (AV), and it is the base for everything that follows.

Assessable value = CIF value in taka × 1.01

One important caution: customs will not always accept your invoice price. For many goods there is an internal minimum (often called the tariff value or assessment value) used at each port. If your declared price is lower, the assessing officer can raise the value, and every tax below goes up with it. Our tariff search shows values recorded at different ports so you can check this before shipping.

Step 3: Apply each tax in order

The taxes are not all charged on the same amount. Some are charged on the assessable value alone; others are charged on the assessable value plus the duties that came before them. That is why the total is more than the simple sum of the percentages.

1. Customs Duty (CD) = AV × CD rate
2. Regulatory Duty (RD) = AV × RD rate
3. Supplementary Duty (SD) = (AV + CD + RD) × SD rate
4. VAT = (AV + CD + RD + SD) × VAT rate
5. Advance Tax (AT) = (AV + CD + RD + SD) × AT rate
6. Advance Income Tax (AIT) = AV × AIT rate

Add the six amounts together and you have the total duty and taxes payable at the port. Divide that total by the assessable value and you get the total tax incidence (TTI) printed in the tariff schedule.

A worked example

Suppose you import a consignment classified under an HS code with these rates: CD 25%, RD 5%, SD 0%, VAT 15%, AT 3% and AIT 5%. This is the most common rate combination for finished goods in the FY 2025-2026 tariff, used on more than 1,400 HS codes. The invoice is USD 10,000 FOB, freight is USD 600, no insurance is declared, and the customs exchange rate is Tk 122.

• Insurance (1% of FOB): USD 100
• CIF: 10,000 + 600 + 100 = USD 10,700 = Tk 1,305,400
• Assessable value: 1,305,400 × 1.01 = Tk 1,318,454
• CD at 25%: Tk 329,613.50
• RD at 5%: Tk 65,922.70
• SD at 0%: Tk 0
• VAT base: 1,318,454 + 329,613.50 + 65,922.70 = Tk 1,713,990.20
• VAT at 15%: Tk 257,098.53
• AT at 3%: Tk 51,419.71
• AIT at 5% of AV: Tk 65,922.70
• Total duty and taxes: Tk 769,977.14

That is 58.40% of the assessable value, exactly the TTI printed in the tariff for these rates, even though the individual rates only add up to 53%. The difference comes from VAT and AT being charged on top of the duties.

Why the real cost is often lower than the TTI

Not every taka in that total is a final cost to your business:

• AT is an advance against VAT. A VAT-registered importer who sells the goods in a VAT-able supply can normally adjust it in the monthly VAT return.
• VAT paid at import can usually be claimed as input tax by a VAT-registered business, subject to the VAT law's conditions.
• AIT can be credited against your income tax liability, except in cases where the law treats it as a final tax, which applies to some commercial imports.

So a manufacturer importing raw materials and a trader importing finished goods can face the same TTI but a very different real cost. Talk to your accountant about which of these you can actually recover.

Other costs that are not in the duty figure

The duty calculation covers taxes only. To budget a full landed cost, also allow for:

• port or airport handling, storage and demurrage charges;
• shipping line or airline delivery order charges;
• C&F agent fees;
• testing, BSTI or other certificate costs where the product requires them;
• transport from the port to your warehouse.

Common mistakes that raise the bill

• Wrong HS code. A code one line away can carry a very different SD or RD. See our guide on finding the right HS code.
• Under-declared value. If customs raises the value, the duty goes up and you may face a penalty as well.
• Ignoring SROs. Many goods carry concessions or extra duties through SROs issued with the budget. Check the current SROs before relying on the base rates.
• Delays. Every extra day in port adds storage charges, which can quickly exceed a small saving on duty.

Check your own numbers

Find your product in the HS code directory, then enter the code and your invoice value in the import duty calculator to see each tax in taka. If you are unsure about the classification or the assessment value at your port, contact our team before the goods ship. It is much cheaper to fix a problem on paper than at the port.