A staggering Tk34,000 crore in unpaid fuel import duties has become a significant headache for Bangladesh's customs revenue, and the situation is more complex than it seems. While private businesses must pay all import duties upfront, two of the government's biggest energy importers – Bangladesh Petroleum Corporation (BPC) and Petrobangla – have been receiving fuel shipments without immediate payment.
This practice, according to customs officials, is significantly hindering revenue collection at Chattogram Custom House, which manages most of the nation's petroleum and liquefied natural gas (LNG) imports. The custom house heavily relies on payments from these state-owned entities to meet its financial goals.
The most substantial amount of unpaid dues is linked to Petrobangla's LNG imports.
In an official letter dated January 8, Chattogram Custom House demanded Tk22,048.62 crore from Petrobangla for unpaid duties and taxes accumulated between 2021 and December 2025. The customs authority alleges that LNG cargoes were released without proper assessment or payment.
The letter, obtained by The Business Standard, reveals that Petrobangla imported LNG under 408 bills of entry up to November 30, 2025. While duties were paid for only 38 bills, the remaining 370 consignments were cleared without payment.
The customs authority has stated that this violates Sections 83, 84, and 90 of the Customs Act, 2023. These sections require importers to submit bills of entry, complete assessments, and pay all applicable duties and taxes before the release of goods.
"Petrobangla has been releasing LNG consignments by submitting bills of entry without paying duties or taxes, which is clearly contrary to the law," stated Tafsir Uddin Bhuiyan, the additional commissioner of Chattogram Custom House.
BPC's Tk12,347 crore Exposure
BPC and its subsidiaries, including Padma Oil Company, Meghna Petroleum, Jamuna Oil Company, Eastern Refinery, and Standard Asiatic, have also amassed significant unpaid customs liabilities.
Between July 2020 and June 2025, these entities imported goods under 7,190 bills of entry, resulting in potential unpaid duties and taxes of Tk12,347 crore, according to customs officials.
Show-cause and demand notices were issued for 695 bills, claiming Tk3,430.32 crore. BPC later paid Tk700 crore, but as of October 29, 2025, final demand notices were still outstanding on 578 bills, amounting to Tk2,730.32 crore.
An 'Unequal System'
Customs officials have expressed frustration over the repeated reminders that have failed to secure timely payments, leading to the issuance of final demand notices.
They claim that government-owned importers benefit from operational privileges not afforded to private firms, allowing them to clear goods without immediate duty payment.
"Private importers cannot release goods without paying duties. But state-owned entities do, and that gap is one reason we struggle to meet revenue targets," Tafsir Uddin said.
With Chattogram handling the majority of fuel imports, any delays by BPC and Petrobangla directly affect national revenue performance, he added.
Energy expert Professor M Tamim highlighted that the two companies collect duties and taxes from consumers but fail to pass them on to the government.
"Releasing imports without paying duties is a clear irregularity," he said, urging the National Board of Revenue to intervene.
Why the Payment Delays?
Petrobangla's Director (Finance), Mizanur Rahman, explained that LNG imports were previously subject to double taxation, with a 15% VAT at the import stage and another 15% during distribution.
"The government withdrew the 15% import-stage VAT in June 2025, leaving only a 2% advance income tax (AIT) and no customs duty on LNG imports," he stated.
"We are now paying the AIT regularly. Most of the Tk22,048 crore dues relate to the period before June 2025."
A senior Petrobangla official cited chronic delays in government subsidy payments as the primary reason for the company's inability to clear its tax liabilities.
"We sell gas at a subsidised rate of around Tk2 per unit. The government is supposed to reimburse that subsidy, but Finance Division delays have left us short of cash," the official said.
The situation was further exacerbated by the weakening of the taka and soaring global LNG prices, which significantly increased import bills.
Petrobangla Chairman Mohammad Reznur Rahman stated, "We are working with the NBR and the Finance Division. Some arrears have already been paid, and once the subsidy is disbursed, we will settle the remaining dues."
BPC's chairman and directors did not respond to calls for comment. However, a BPC official mentioned that the corporation's companies regularly pay their dues, and payments are only withheld when disputes arise over customs claims.
Duties Waived in the Budget
The FY2025–26 budget eliminated import duties on several fuels, including diesel and natural gas, while providing concessions on CNG, NPG, and LNG imports.
The import duty on natural gas was reduced from 100% to zero, and duties on crude and partially refined petroleum, fuel oils, gas oil, and other heavy oils were completely waived.
For CNG, NPG, and LNG, the import duty was lowered from 10% to 5%.
The budget also proposed reducing the import duty on crude oil and oil derived from bituminous minerals from 5% to 1%.
For aviation fuels – including jet fuel, kerosene, naphtha, motor and aviation spirits, and white spirit – the duty was proposed to fall from 10% to 3%, with the same rate applied to light diesel and high-speed diesel.
But here's where it gets controversial... Is it fair that state-owned entities have different rules than private businesses? And this is the part most people miss... Could the government's subsidy delays be a legitimate reason for these unpaid duties? What do you think about the government's approach to fuel import duties? Share your thoughts in the comments below!
