Trade bodies back budget, urge effective execution

Leading business chambers and professional bodies have welcomed the proposed Tk 9.38 lakh crore budget for FY2026-27, saying its focus on economic reforms, investment, employment and social protection aligns with the country’s development priorities.

However, they cautioned that ambitious revenue targets, large financing needs and persistent implementation challenges could undermine the budget’s objectives without meaningful reforms and stronger governance.

The Metropolitan Chamber of Commerce and Industry (MCCI) described the budget as a bold attempt to support economic recovery, job creation and social protection at a time when the economy is grappling with inflation, high interest rates, weak investment and global uncertainty.

MCCI President Kamran T Rahman welcomed the government’s 10 priority areas, saying they could help restore macroeconomic stability.

However, he termed the revenue target of Tk 6.95 lakh crore ambitious, noting that National Board of Revenue collections reached only 65 percent of the revised target during the current fiscal year.

Without structural reforms, efforts to achieve the target could increase pressure on taxpayers and raise living costs, the chamber warned. It also expressed concern over investment falling to 27.93 percent of GDP, the lowest level in a decade.

MCCI welcomed higher allocations for social safety-net programmes, education and healthcare, as well as initiatives such as the BanglaBiz platform and the proposed Tk 60,000 crore stimulus package.

The Bangladesh Chamber of Industries (BCI) also endorsed the budget, describing it as reform-oriented and business-friendly despite prevailing economic challenges.

BCI President Anwar-ul Alam Chowdhury (Parvez) said proposed reforms in banking, tax administration and public financial management could have a positive long-term impact on industry.

The Dhaka Chamber of Commerce and Industry (DCCI) said the budget reflects the government’s growth ambitions but questioned the feasibility of achieving a 30.34 percent increase in revenue collection under current economic conditions.

DCCI President Taskeen Ahmed cautioned that excessive borrowing to finance the deficit could hamper recovery in the banking sector and crowd out private investment.

Taskeen also praised tax reforms, incentives for healthcare, renewable energy and electric vehicles, and efforts to broaden the tax base without raising VAT rates.

Institute of Chartered Accountants of Bangladesh (ICAB) President NKA Mobin cautioned that a proposed 0.2 percent tax on retail businesses and a 0.5 percent tax on many agricultural products could add to inflationary pressures.

ICAB welcomed tax, VAT and customs reforms, including fixed tax rates, start-up incentives and wider digitalisation to strengthen compliance and revenue collection.

The Chittagong Chamber of Commerce and Industry (CCCI) welcomed the proposal to reduce advance income tax on imports to 4 percent from 5 percent, saying it would ease cost pressures and improve cash flow for businesses.

CCCI President Mohammed Amirul Haque said the lower rate would particularly benefit industries reliant on imported raw materials, intermediate goods and capital machinery.

He also praised tax incentives for renewable energy, electric vehicles, semiconductors and electronics manufacturing, as well as plans to establish free-trade zones and liberalise foreign investment in logistics facilities.

Meanwhile, the American Chamber of Commerce in Bangladesh (AmCham) described the budget as a balanced effort to stabilise the economy while supporting growth and social welfare.

AmCham President Syed Ershad Ahmed said the projected fiscal deficit of 3.55 percent of GDP remains manageable, but warned that heavy domestic borrowing could restrict private-sector credit and underscored the need for tax reforms, digitalisation and greater transparency.

The proposed budget is business-friendly and marks a shift towards reducing regulatory barriers, lowering taxes and expanding automated government services, said Ferdaus Ara Begum, chief executive officer of Business Initiative Leading Development (BUILD).

BUILD also questioned the feasibility of achieving the government’s GDP growth and inflation targets under current economic conditions.

The Bangladesh Textile Mills Association (BTMA) welcomed the government’s focus on investment, production, employment and export competitiveness, describing it as a positive step for the primary textile sector.

BTMA President Shawkat Aziz Russell said the budget incorporated several industry proposals, including lower taxes on export incentives, recycled materials and cotton supplies, alongside duty waivers on key solar-power equipment.

However, BTMA expressed concern over the proposed removal of the 30 percent value-addition requirement for raw material imports under bank guarantees, warning of possible misuse. It also called for a 15 percent corporate tax rate and greater policy support to address rising costs and improve competitiveness.

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) President Mohammed Hatem said the proposed budget addresses two key demands of the garment industry: tax reform and easier imports of solar-energy equipment amid the ongoing gas and power crisis.

He welcomed tax incentives for solar power systems and duty-free imports of raw materials for export-oriented non-bonded firms.

However, he called for clearer provisions for adjusting or refunding advance income tax (AIT).

Hatem questioned the proposed 5 percent tax on polyester staple fibre imports, noting that local production meets less than 10 percent of demand.

He also said high lending rates and unresolved energy shortages remain major obstacles to industrial growth and investment.