Find alternative ways to raise revenue, says BNP’s Fakhrul

“There is a lack of coordinated action in monetary and fiscal policy and market management to rein in inflation. The govt cannot ignore group interests,” he says

BNP Secretary General Mirza Fakhrul Islam Alamgir has labelled the government's decision to impose VAT and supplementary duty on more than 100 goods and services as “irresponsible” and demanded its withdrawal.

He also advised the government to find other ways to generate revenue.

At a press conference at the BNP Chairperson's Office in Gulshan on Saturday morning, the senior BNP leader highlighted the negative impact of the decision on the common people.

Fakhrul said, "The current interim government has imposed VAT and supplementary duty on more than 100 goods and removed tax exemptions on some goods amid the ongoing economic instability and high inflation... This decision of the government will have a negative economic impact on the daily lives of the common people, especially the poor and middle class.”

"The BNP is concerned about the impact of such a decision by the current interim government on the lives of the common people. We call for the immediate withdrawal of these irresponsible decisions, like imposing taxes and VAT or indirect taxes on the general public.”

Highlighting the impact of the new taxes, the BNP secretary general, who once taught economics, said, “Such a sudden decision by the government has caused strong dissatisfaction among various circles related to the financial sector, including the business community. According to economists, this decision of the government clearly proves that there is an extreme lack of coordination in the government’s monetary policy, fiscal policy and market management.”

“The country’s economic situation has become fragile due to the corruption and mismanagement of the fascist Awami League government. In this fragile situation, if the government tries to meet its expenses by increasing VAT or taxes and taking the easy way out, it will not be beneficial for the people of the country in any way.”

Fakhrul said, “We have said before that we will fully support and cooperate with this interim government. Therefore, I request the government to put the views of the people first in formulating policies.”

“You should focus on increasing direct taxes instead of increasing indirect taxes. Because indirect taxes affect all classes of people almost equally and increase the burden on the lower class. The ongoing financial problems can be solved by reducing government expenditure and restructuring the financial management of the current budget without increasing direct taxes.”

‘FOCUS ON REDUCING EXPENDITURE’

Fakhrul said, “Under the current circumstances, the government should first focus on reducing expenditure. We think that if the government reconsiders its development budget and eliminates unnecessary and financially unreasonable projects, it is possible to reduce expenditure by about 20 percent and this will help save about Tk 600 billion”.

“In terms of operating expenditure, if the government reduces expenditure in the local government budget and subsidy sector and can reduce overall operating expenditure by 10 percent, then a cut of at least Tk 500 billion is possible. The government can temporarily save on spending by reducing the budget of loans given to autonomous institutions. A loan of Tk 508.75 billion was budgeted for autonomous institutions in the 2024-25 fiscal year.”

Fakhrul also opined that the government can save at least Tk 1 trillion in the budget and reduce the deficit by cutting spending.