The interim government’s Advisory Council has approved the proposed national budget for the 2025–26 fiscal year, totaling Tk 7.90 trillion, with raising social safety allocation by Tk 10,000 crore and scrapping the provision allowing the legalisation of black money.
The budget was passed on Sunday afternoon at a meeting of the Advisory Council with Chief Adviser Prof Muhammad Yunus in the chair. Later in the day, Finance Adviser Dr. Salehuddin Ahmed presented the final details at a press conference held at the Secretariat.
The budget, the country’s 54th and the first under the current interim administration, was originally presented on June 2 via a pre-recorded address by the Finance Adviser. It will come into effect on July 1.
Among the most significant changes was the increase in the social safety net allocation—from the proposed Tk 81,700 crore to Tk 91,700 crore. However, this will not change the overall size of the budget.
Another major revision was the removal of the previously proposed opportunity to legalize undisclosed income—commonly referred to as black money—by paying additional taxes. “There will be no provision to whiten black money in the final budget,” Dr. Salehuddin confirmed. The move came after it drew criticism from different quarters.
With the new budget, the interim government eyes to achieve a 5.5% GDP growth target and cut the raging inflation rate within 6.5% during the next fiscal year. The budget deficit is estimated at 3.6% of the Gross Domestic Product (GDP)..
Alongside the main budget, the Advisory Council also approved the supplementary budget for the current fiscal year.
As per constitutional requirements, the new budget will be implemented via a Presidential Ordinance. President Md. Shahabuddin is expected to sign the finance bill ahead of the ordinance’s issuance.
Following the initial budget proposal, the government opened an online platform for public feedback. Several private organizations and economists submitted their views, with some raising objections. However, no major revisions were made beyond the three approved changes.
Finance Division Secretary Dr. Md Khairuzzaman elaborated on the revised benefits for government personnel. He noted that the previously announced allowances for public employees have been increased to a minimum of Tk 1,500 for active staff and Tk 750 for pensioners, aimed at addressing inflationary pressures.
National Board of Revenue (NBR) Chairman Abdur Rahman Khan further elaborated on the key fiscal measures introduced in the new budget. He explained the updated tax structure for publicly traded companies. Those companies with at least 10 percent of their paid-up capital floated through an Initial Public Offering or direct listing will now face a tax rate of 22.5 percent.
However, if all earnings in the fiscal year are conducted through bank transfers, the rate will be reduced to 20 percent. All other publicly listed companies will be taxed at 27.5 percent, or 25 percent if their income is fully transacted through banks.
The tax rate for private educational institutions—including universities, medical and dental colleges, engineering colleges, and IT-focused colleges—has been reduced from 15 percent to 10 percent. Additionally, property transfer tax deduction rates have been revised downward to 5 percent, 3 percent, and 2 percent from their previous levels of 8 percent, 6 percent, and 4 percent, respectively.
On the import side, several changes were introduced to ease financial burdens and support priority sectors. The advance tax on refined petroleum product imports has been lowered to 2 percent from 7.5 percent proposed earlier. A customs valuation system based on invoice value will replace the tariff value method for petroleum imports. Consequently, the import duty on crude petroleum has been reduced from 5 percent to 3 percent, and on other petroleum products from 10 percent to 6 percent.
Support for industries and social sectors was also highlighted. VAT has been exempted at the production stage for cotton recycled from jute waste, and on premises rented by women entrepreneurs operating beauty parlors. Exemptions were also granted on the import of ballpoint pens, heart rings, and eye lenses, enhancing accessibility for basic goods and essential medical supplies. Furthermore, the import duty on solar inverters has been drastically reduced from 10 percent to just 1 percent to promote renewable energy adoption.
To strengthen healthcare delivery, the government has added 10 more items to the list of medical equipment eligible for concessional import duty by hospitals. For the domestic tire industry, the import duty on technically specified natural rubber—a key raw material—has been reduced from 10 percent to 5 percent to encourage local manufacturing of high-quality tires.
With the President’s signature on the finance bill expected shortly, the new fiscal measures will come into force from the beginning of the next financial year on July 1, 2025.