Importing from China to Bangladesh: Customs, VAT and Letter of Credit (2026)

The ready-made garment sector was worth 31.5 billion dollars in fiscal year 2020-2021, according to the US Department of Commerce's Country Commercial Guide, the economy's leading driver alongside remittances from expatriate workers. This industry relies heavily on imported inputs, led by raw cotton and textile machinery, two categories that Bangladesh itself exempts from customs duty, still according to the same source.

China is among the world's leading suppliers of cotton yarn, fabric and garment-making machinery, but our sources do not give a precise product-by-product share of Bangladesh's imports from China: that figure is checked on the UN Comtrade database. The administrative framework, however, is confirmed regardless of origin: a letter of credit is among the documents required for customs clearance, according to the Bangladesh Customs portal, and Chittagong remains the country's main seaport, alongside Mongla and Dhaka airport for air freight.

Bangladesh has been a WTO member since 1995, according to World Tariff Profiles 2026, published jointly by the WTO, the International Trade Centre and UNCTAD. The country binds only 17.6% of its tariff lines overall, and 4.3% on the non-agricultural side, leaving the administration wide latitude to set its applied duties.

The US Country Commercial Guide, updated on 19 March 2026, states that Bangladesh is due to graduate from Least Developed Country status in 2026, a deadline to verify as of your reading date. Our sources did not confirm a bilateral free trade agreement between China and Bangladesh: this point should be checked with the Ministries of Commerce of both countries.

The average most-favoured-nation duty applied across all lines stood at 14.1% in 2025, with an average of 17.7% on agricultural goods and 13.5% on non-agricultural goods, according to the WTO's World Tariff Profiles 2026. The common maximum rate remains 25%, within a range of 5% to 25% for most goods, notes the US Country Commercial Guide updated on 19 March 2026. By product family, the WTO records an average duty of 19.5% on textiles and 24.4% on apparel, against 3.3% on mechanical, office and computing machinery.

Customs duty is only one layer among several. The US guide also lists a 5% advance income tax, VAT of 0 to 15% with exemptions on certain inputs, and a supplementary duty that can climb as high as 500% on luxury items such as cigarettes, alcohol or perfume. The Bangladesh Customs portal publishes a calculator that combines these elements into a single indicator, the Total Tax Incidence or TTI, to be multiplied by the customs value.

As a simplified illustration, a shipment not subject to supplementary duty, with a customs value of 20,000 dollars at the national average duty of 14.1%, carries roughly 2,820 dollars in customs duty, plus advance income tax and VAT according to the TTI specific to its tariff line. The exact order in which these stack is not detailed in our sources: the TTI for a tariff code should be checked on the official Bangladesh Customs calculator before placing an order.

Any company importing commercially must first obtain an Import Registration Certificate, the IRC, issued by the Chief Controller of Imports and Exports at the Ministry of Commerce, generally within three working days, according to the US Country Commercial Guide. For an industrial consumer, this certificate sets a maximum annual value per product, including for restricted items.

The official Bangladesh Customs portal lists the documents required for clearance: letter of credit, invoice, bill of lading or air waybill or road/rail consignment note, packing list, certificate of origin except in specific exceptions, insurance policy, and a VAT certificate bearing the Business Identification Number, the BIN. The single declaration, the Bill of Entry, is filed on ASYCUDA World after the import manifest; the administration then assesses duties and taxes before release.

According to the Bangladesh Customs portal, 55 product categories require a certificate to BDS standards, the national reference framework administered by the Bangladesh Standards and Testing Institution, before clearance. Other requirements apply depending on the goods: radioactivity testing for food products, pre-shipment inspection for milk and certain materials including coal, authorization for explosives, and an intellectual property certificate for branded goods.

Our sources give neither a cost schedule nor a typical timeline for a BDS certificate: this should be checked with the Bangladesh Standards and Testing Institution before placing an order in one of the 55 categories concerned.

The Bangladesh Customs portal flags several categories of goods subject to a special regime, without publishing the full list at the page consulted: trade in endangered species under the CITES convention, dangerous goods, products covered by the Chemical Weapons Convention, and goods subject to intellectual property or anti-money-laundering controls. The IRC also sets a maximum annual value for certain restricted items, according to the US Country Commercial Guide.

Our sources did not yield the complete official list of prohibited or license-restricted products: it should be checked in the Import Policy Order, published by the Ministry of Commerce, before placing an order for a sensitive product.

Chittagong remains Bangladesh's main seaport, complemented by Mongla, while Dhaka airport handles most air freight. Our sources do not give a verifiable sea transit time between southern Chinese ports and Chittagong: this should be confirmed with a freight forwarder at the time of booking.

For a first shipment, FOB from southern China works well if the Bangladeshi buyer arranges transport themselves; CIF or CFR suit cases where an intermediary handles it through to the arrival port. DDP remains inadvisable unless the Chinese seller is itself an accredited customs declarant in Bangladesh.

Since a letter of credit is among the documents required for clearance, most orders to Bangladesh are built around one rather than a simple wire transfer, opened with a Bangladeshi bank on the basis of a precise proforma invoice. A change of bank details received by email should always be verified with a direct phone call before any transfer, as this type of fraud is common in China sourcing.

A first order follows a precise sequence: specifications, verification of the Chinese factory, an approved sample, a proforma invoice with the chosen Incoterm, opening the letter of credit with the IRC in order on the Bangladeshi side, a BDS file started in parallel if needed, production follow-up, pre-shipment inspection, freight to Chittagong or Dhaka, then customs clearance by the Bangladeshi importer or their local freight forwarder.

Sorva is a sourcing and trading house based in Guangzhou, in the Tianhe district, backed by a Chinese subsidiary whose corporate purpose covers the purchase, resale and export of goods, and by a parent company in France. Our Chinese-speaking team finds and verifies factories, organizes visits and samples, negotiates prices, arranges pre-shipment quality inspection and organizes freight to a Bangladeshi port or airport, while gathering the documents needed for an invoice that matches the letter of credit opened by the buyer. Sorva never acts as the official importer of record in Bangladesh and does not clear customs on site. Our base service is invoiced in dollars, complemented by region-specific options, such as documentary support for BDS certification, quoted on request.