Development organisations have welcomed the sweeping tax and duty exemptions for renewable energy and green technologies proposed in the national budget for FY2026–27, calling the measures a major step towards a just energy transition and long-term energy security.
In a joint statement on Saturday, ActionAid Bangladesh and the Just Energy Transition Network Bangladesh (JETnetBD) praised what they described as “historic and reform-oriented” initiatives aimed at building an environmentally sustainable and self-reliant energy system.
They said the budget’s emphasis on renewable energy, alongside generous fiscal incentives for solar equipment and electric vehicles (EVs), would help reduce Bangladesh’s heavy dependence on imported liquefied natural gas and fossil fuels.
“The unprecedented tax and duty waivers on renewable energy and clean technologies will significantly advance Bangladesh’s just energy transition,” the statement said.
The organisations noted that the government has set a target of meeting 20 percent of electricity demand from renewable sources by 2030, including generating 10,000 megawatts of solar power. The proposed allocation of Tk 17,345 crore for the power and energy sector — up from Tk 16,952 crore in the current fiscal — was also seen as a positive signal.
A key highlight of the budget is the full withdrawal of import duties, regulatory duties and advance taxes on solar equipment until June 2031, a move expected to accelerate solar adoption, the joint statement said.
The continuation of zero tax on solar power generation until 2035, along with a 5 percent tax rebate for consumers on solar electricity bills, was described as a strong incentive for expanding clean energy use at the grassroots level.
The statement also welcomed duty and tax exemptions on raw materials for lithium-ion and sodium-ion battery production until 2030, which could support the growth of a domestic battery industry.
In the transport sector, the budget proposes significant incentives for electric vehicles, including reduced tax burdens on EV imports and complete duty waivers on EV charging infrastructure. Tax benefits for local EV manufacturing are also expected to boost industrialisation and promote cleaner mobility.
At the same time, higher taxes on fossil fuel-powered vehicles were praised as a necessary step to discourage environmentally harmful transport.
The organisations said the government’s broader plans — including cost-efficient power generation, tackling corruption in the energy sector and reviewing capacity payments — reflect a shift towards greater transparency and efficiency.
They argued that prioritising renewable energy and EV adoption would help shield the economy and vulnerable communities from global fuel price volatility and climate risks.
Describing the budget measures as “forward-looking,” the organisations expressed hope that the policies would pave the way for a sustainable, equitable and climate-resilient energy future for Bangladesh.