Budget cuts assessment value on lipstick and skin cream
Graphics: Agamir Somoy
The proposed budget for the 2026-27 fiscal year reduces the minimum assessment value for seven types of cosmetic products, including lipstick, skin cream, moisture lotion, and face wash.
Just a year ago, the interim government had increased duties and taxes on beauty products by categorising them as luxury goods. Moving away from that stance, the government has provided a message of relief for the beauty market.
Finance Minister Amir Khosru Mahmud Chowdhury said that while the existing tariff rates for these products remain unchanged, the minimum assessment value is being reduced by 25 to 30 percent.
As a result, the costs for importers will decrease. If this benefit is passed on through the market system, consumers may also have the opportunity to purchase products at lower prices.
According to the new proposal, the minimum assessment value for lipstick has been reduced from $40 to $30 per kilogram. This could reduce the duty and tax by around Tk 2,000 per kilogram.
For skin cream, the assessment value has been lowered from $20 to $14, creating an opportunity to reduce costs by about Tk 1,226 per kilogram.
Similarly, the assessment value for moisture lotion and four types of face wash has been set at $7, down from $10. This could reduce the tax burden by up to Tk 613 per kilogram.
According to the National Board of Revenue (NBR), from July of the current fiscal year until last Wednesday, the assessment value for imports of these seven categories of products was Tk 405 crore.
Against this, the government collected around Tk 642 crore in revenue. If the new proposal is implemented, revenue income may decrease slightly. Preliminary estimates suggest a potential revenue loss of about Tk 75 crore from skin cream and around Tk 50 crore from moisture lotion and face wash.
However, not all import consignments will be assessed at the new minimum price. Duties may still be set higher based on brand, quality, and declared price, so the actual revenue loss could be lower.
On the other hand, the government has not granted concessions on all cosmetic products. The previous assessment values have been maintained for eyebrow makeup products and several products used for hand and foot beauty care.
Instead, for lip liner, lip gloss, and lip gel, the minimum assessment value has been increased from $20 to $30 per kilogram, which will increase the government’s revenue income.
According to analysts, with this decision, the government has created an opportunity for limited relief for consumers on one hand, and on the other, it has attempted to bring a balance between revenue collection and market stability in the cosmetics sector.
