Budget gets business backing
Leading business organisations including FICCI, DCCI, ICAB, CCCI, AmCham, BGMEA and BKMEA have largely welcomed the proposed national budget for FY2026-27, highlighting its pro-business direction and reform-oriented measures.
However, they also cautioned that fiscal pressures, ambitious revenue targets and weak implementation capacity could limit its effectiveness.
In separate statements and press briefings, the trade bodies said the budget includes several positive initiatives aimed at improving the investment climate, easing tax compliance, and supporting macroeconomic stability.
At the same time, they stressed that the real impact will depend on effective implementation and prudent fiscal management.
The Foreign Investors’ Chamber of Commerce and Industry (FICCI) welcomed key reforms in the Finance Bill 2026, including treating tax deducted at source as advance tax, introducing automated tax refund systems, and shifting VAT return filing to a quarterly basis.
It said these measures would reduce compliance costs and improve cash flow for businesses.
The chamber also appreciated reductions in withholding taxes on imports, foreign loans and machinery rentals, along with simplified profit repatriation procedures.
However, FICCI cautioned against the proposed 0.2 percent retail-level advance tax, called for a transition period for mandatory e-VAT implementation, and noted the absence of a clear corporate tax reduction roadmap.
It also warned that achieving the Tk6.95 lakh crore revenue target would be challenging.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said the budget’s focus on investment facilitation and long-term policy stability could support industrial growth if implemented effectively.
Similarly, the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) said the budget contains several positive measures aimed at boosting investment and employment generation.
The Dhaka Chamber of Commerce and Industry (DCCI) described the Tk9.38 lakh crore budget as reflecting strong growth ambitions, but warned that the projected 30.34 percent revenue growth target may be difficult to achieve under current economic conditions.
It also cautioned that heavy reliance on bank borrowing to finance the deficit could reduce private-sector credit availability and slow investment recovery.
DCCI further pointed to weak implementation capacity, noting that the current fiscal year’s Annual Development Programme (ADP) execution rate stands at only 36.19 percent despite a proposed Tk3 lakh crore allocation for the next fiscal year.
While welcoming reforms such as withholding tax adjustments, incentives for renewable energy and electric vehicles, and digital tax administration, it said inflation concerns persist as the tax-free income threshold was left unchanged.
The Institute of Chartered Accountants of Bangladesh (ICAB) also expressed concern over increased domestic bank borrowing, warning that it could crowd out private investment. It said new taxes on retail and agricultural sectors may add inflationary pressure.
However, ICAB welcomed several reforms, including fixed tax rates for five years, reduced minimum tax burdens, dispute resolution mechanisms, and greater digitalisation of tax processes, which it said would strengthen transparency and compliance.
The Chittagong Chamber of Commerce and Industry (CCCI) welcomed the reduction of advance income tax on imports from 5 percent to 4 percent, saying it would ease liquidity pressure and improve working capital for import-dependent industries.
It also appreciated incentives for renewable energy, electronics, semiconductors, and logistics reforms such as free trade zones and inland container depot liberalisation.
The American Chamber of Commerce in Bangladesh (AmCham) described the budget as broadly balanced and supportive of stability and growth, but cautioned that heavy domestic borrowing could restrict private-sector credit.
It stressed the need for stronger tax administration, greater digitalisation, and improved transparency to broaden the tax base.
While welcoming increased allocations for education, healthcare and social protection, AmCham said policy consistency and efficient implementation will be essential to convert budgetary allocations into real economic outcomes.
Overall, business leaders agreed that the FY2026-27 budget reflects a reform-oriented and investment-friendly direction, but emphasized that fiscal discipline, realistic revenue planning and stronger execution capacity will be critical to achieving its objectives.
