The Bangladesh Auto Biscuit and Bread Manufacturers Association has strongly opposed the government’s decision to increase Value Added Tax (VAT) on bread and biscuits in the proposed national budget for FY2025-26, warning that the move will push prices up and further reduce packet sizes.
At a press conference held at the Dhaka Reporters’ Unity (DRU) on Saturday, association leaders demanded full withdrawal of the newly imposed 7.5 percent VAT—up from the previous 5 percent—saying the industry and consumers cannot absorb the additional burden.
“The industry has already endured rising costs of wheat, oil, and sugar without raising consumer prices. Now, with the VAT hike, an extra load has been placed on us,” said Shafiqul Rahman Bhuiyan, president of the association.
Biscuits and bread, he noted, are staple foods for students, workers, and low-income families, and should therefore be declared essential goods and exempted from VAT. “We are embarrassed to say how small the packets have already become. At this rate, one day we’ll be left with only the packaging—no biscuit or bread inside,” he remarked.
Bhuiyan also questioned the logic of the tax hike, calling it discriminatory. “Even regimes once called fascist left the VAT on bread and biscuits at 5%. So who is truly oppressive now?” he asked, warning that consumers should not blame producers if prices rise.
The association accused the government of adopting a regressive tax policy that burdens the poor while exempting luxury goods. “This shows a clear shift toward an unfair tax structure—contradicting the spirit of social equity,” Bhuiyan said.
Vice President Shakhawat Hossain Mamun cited research showing that bread and biscuits are vital for meeting the daily hunger needs of low-income groups and students. Referring to a World Bank report placing Bangladesh in the “red zone” for food security, he said: “In such a critical situation, this VAT increase is not only illogical but cruel. If revenue is the goal, tax the wealthy, not essential food items.”
Other speakers, including Indrajit Sarkar, assistant vice president of the association, and Abdur Rahman, general manager of Kishwan Food Industries Ltd., echoed the call for immediate withdrawal of the VAT hike to protect food affordability and social justice.