Businesses hail budget, remain unhappy over corporate tax

Concerns have also emerged over mandatory e-VAT compliance for large companies and the broader investment climate

Business groups have broadly welcomed the BNP government's first budget in nearly two decades as “business-friendly”, but voiced disappointment over the decision to leave corporate tax rates unchanged.

They have warned that the absence of a long-term roadmap for corporate tax cuts could weaken Bangladesh's position in the regional race for foreign investment.

The government unveiled the Tk 9.38 trillion budget for FY2026-27 on Thursday, around four months after taking office.

Finance Minister Amir Khosru Mahmud Chowdhury proposed keeping corporate tax rates unchanged.

FICCI Fears Investment Setback

The Foreign Investors' Chamber of Commerce and Industry (FICCI) welcomed the government's strategic "3R" framework -- Recovery, Restoration and Reconstruction.

In an immediate budget reaction issued on Thursday, the chamber described the finance bill as a “positive, progressive and business-friendly” initiative.

The FICCI said the emphasis on deregulation and technology-driven reforms would strengthen investor confidence.

The organisation also viewed the decision to treat Tax Deducted at Source (TDS) as advance tax rather than minimum tax as a positive step.

It, however, warned that without a long-term corporate tax reduction roadmap, Bangladesh could fall behind regional competitors in attracting foreign direct investment (FDI).

The FICCI also said mandatory e-VAT for large and multinational taxpayers, without adequate preparation, could create implementation challenges.

BTMA Seeks Lower Corporate Tax

The Bangladesh Textile Mills Association (BTMA) called for reducing the corporate tax rate to 15 percent to preserve competitiveness.

The association also expressed concern over a proposal to remove the requirement for 30 percent value addition for raw material imports under bank guarantees.

According to BTMA, the change could be open to misuse.

The organisation believes the condition should remain in place to help local industries remain competitive after Bangladesh graduates from least-developed country (LDC) status.

BTMA President Showkat Aziz Russell, however, said the restructuring of tariff rates, tax incentives for solar power equipment and several business facilitation measures send positive signals.

Mobile Operators Push for ‘Rational’ Tax Rates

The Association of Mobile Telecom Operators of Bangladesh (AMTOB) welcomed the proposal to abolish the Tk 300 SIM tax but urged the government to bring corporate tax rates down to a reasonable level.

AMTOB Secretary General Mohammad Zulfikar said the proposal to replace the specific SIM tax with a value-based VAT system was a timely measure.

Under the proposal, the existing fixed levy on SIM cards would be removed and replaced with a standard 15 percent VAT on the sale price.