The proposed national budget for the fiscal year 2025–26, unveiled by the interim government, introduces a series of tax reforms, VAT exemptions, and duty adjustments expected to influence the prices of a wide range of goods and services.
✅ What’s Likely to Get Cheaper
Presenting the Tk 7.9 trillion budget, Finance Adviser Dr. Salehuddin Ahmed announced several measures aimed at easing the financial burden on consumers, particularly through exemptions on essential and health-related products:
- Sanitary napkins: VAT exemption at the business level
- Packaged liquid milk: Fully VAT exempt
- Ballpoint pens: VAT exemption applied
- Handmade clay utensils and natural-material items: VAT removed at the production stage
- Textile-grade date chips: Now VAT exempt
- Computer monitors up to 30 inches: VAT exemption extended (previously up to 22 inches)
- Lease rent on passenger aircraft: VAT waived
- Ice cream: Supplementary duty reduced from 10% to 5%
- Hospital bed production materials and spare parts: VAT exemption until 2030
- Locally manufactured hybrid and electric vehicles: VAT exemption extended through June 2030
- Hybrid and electric ICU/general ambulances: Conditionally exempt from VAT
- Lithium and graphene batteries: Full VAT exemption until June 2027; partial exemption through 2030
- LNG (Liquefied Natural Gas): VAT exemption may lower energy costs
- Components for refrigerators, air conditioners, and compressors: Supplementary duty exemption extended to 2028
❌ What’s Likely to Get Costlier
Despite the budget being Tk 70 billion smaller than the previous year—the first contraction since independence—the government seeks to raise revenue through increased VAT, duties, and surcharges. This is likely to raise prices on a number of products:
- Refrigerators and air conditioners: VAT may increase from 7.5% to 15%
- Locally manufactured mobile phones: Proposed VAT hike of 2%–2.5%
- Motorcycles: Customs duties and VAT on parts and imports expected to rise
- Imported cosmetics and beauty products (lipstick, eyeliner, face wash): Higher customs value and import taxes
- Imported toys and chocolates: Customs valuation increased
- Disposable plastic items (cups, plates, bowls): VAT may rise to 15%
- Razor blades, screws, bolts, barbed wire, electric fittings, door locks: Prices likely to rise due to tax adjustments
- Construction materials (e.g., rods): May become more expensive
- Self-copy, duplex, and coated paper: Anticipated price hikes
- Batteries for electric rickshaws: VAT and duty increases expected
- Imported helicopters, marble, and granite: Higher taxes imposed
- Nutritional supplements for pregnant and lactating mothers: Import costs to increase
- Beverage items: Higher taxes may raise prices
🔧 Impact on the Service Sector
The budget also includes changes that will affect various services:
- Convention halls and conference centers: Source tax may be doubled
- Commercial vehicles: Advance tax to rise
- Private vehicle owners: Increased surcharges expected
- Mobile tower-sharing companies and telecom services: A proposed 20% source tax may drive up service charges
📉 Budget Strategy
This year’s budget marks a strategic shift, with a Tk 70 billion reduction from FY 2024–25. The contraction is part of a tighter monetary policy aimed at reining in inflation, with a target of bringing it below 8% by June.