[🇧🇩] Budget For 2026-2027

[Saif]

Date of Event: Mar 13, 2026

Source: https://thefinancialexpress.com.bd/economy/frame-down-to-earth-budget-avoid-overly-ambitious-targets

CHANCE FOR NEW GOVT TO SHOW LEADERSHIP IN FISCAL MANAGEMENT
Frame down-to-earth budget, avoid overly ambitious targets
CPD recommends achievable revenue projections, stronger fiscal management, structural reforms in next budget

FE REPORT
Published :
Mar 11, 2026 00:31
Updated :
Mar 11, 2026 00:31

A view of a media briefing of the Centre for Policy Dialogue (CPD) on the National Budget 2026-27 in the capital on Tuesday, where CPD Distinguished Fellow Dr. Mustafizur Rahman and Executive Director Dr. Fahmida Khatun were present, among others. — FE Photo

Policy experts suggest the new government should adopt a realistic fiscal framework for the upcoming national budget as overly ambitious targets could worsen macroeconomic pressures amid geopolitical tensions and domestic economic challenges.


To make it, the Centre for Policy Dialogue (CPD) economists have recommend for the government's finance authorities to set achievable revenue projections and adopt measures for stronger fiscal management and structural reforms in the 2026-27 budget in the offing.

The CPD suggestion came at a media briefing the think-tank arranged Tuesday in Dhaka for placing recommendations for the budget.

Executive director of CPD Dr Fahmida Khatun noted that the country's economy was currently facing multiple internal and external pressures that require careful and strategic policy responses.

Ensuring macroeconomic stability, boosting investment, protecting vulnerable groups and creating employment opportunities should be the key priorities in the FY2026-27 budget, she said.

The CPD executive makes a point that this happens to be the first national budget of the newly elected government and, therefore, represents "an important opportunity to demonstrate leadership in fiscal management and policy direction".


However, she warns that credible revenue projections and disciplined public spending would must-dos to achieve those objectives.

"The government should avoid setting overly ambitious targets and instead focus on realistic revenue projections, stronger fiscal management and structural reforms," she told the press.

The policy outfit warns that global geopolitical tensions, particularly the ongoing conflict involving the United States and Israel and Iran, pose significant risks to Bangladesh's economy by increasing energy prices and inflating the country's import bill.

Bangladesh relies heavily on imported energy, particularly liquefied natural gas and crude oils from the Middle East, making the economy vulnerable to supply disruptions and global price volatility.

Any disruption to global energy-supply chains could quickly translate into higher domestic inflation, the think-tank alerts.


Dr Khatun raised concerns over a recent trade agreement between Bangladesh and the United States.

Under the agreement, Bangladesh will provide duty-free access to around 4,500 US products, while tariffs on another 2,210 products will be gradually reduced over the next five to ten years.

As a result, CPD estimates, the government may lose about Tk13.27 billion in customs revenue during the current fiscal year.

"The government should reassess the implications of the agreement for both revenue earnings and public spending and, if necessary, reopen discussions with the United States," Dr Khatun said.

According to the CPD, the agreement could also raise issues under World Trade Organisation rules, as Bangladesh might face pressure to extend similar tariff concessions to other trading partners.

She points out that some provisions require Bangladesh to purchase certain products from the United States which could increase government expenditure.


Distinguished fellow of the CPD Dr Mustafizur Rahman said global trade is increasingly being used as a geopolitical tool, weakening the multilateral trading system.

He suggests that the full details of the agreement should be made public as it contains important financial and policy implications.

Since the private sector will be involved in implementing parts of the agreement, the government may need to provide incentives or subsidies to encourage businesses to import US products, he said.

The CPD also expressed concern over Bangladesh's weak revenue mobilisation.

Revenue growth reached only 12.9 per cent until January of the current fiscal year, far below the annual target of 34.5 per cent.

To meet the annual target, revenue collection would need to grow by nearly 59 per cent during the remaining months of the fiscal year, which Dr Khatun describes as unrealistic and impossible.


The revenue shortfall has already come to around Tk600 billion, increasing pressure on government finances.

Due to weak revenue collection, the government's reliance on bank borrowing has risen sharply.

Until December, the government had borrowed Tk 596.55 billion from the banking sector, while non-bank borrowing and foreign financing declined.

"Excessive borrowing from banks creates risks in the financial sector and crowds out private-sector credit," Dr Khatun said.

The think-tank also has highlighted broader economic challenges, including persistently high inflation, weak investment and slow implementation of development projects.

Inflation has remained above 8.0 per cent, while export earnings declined by 3.2 per cent during the current fiscal year. Imports, meanwhile, rose by 3.9 per cent.

Implementation of the Annual Development Programme (ADP) also slowed significantly, with only 20.3 per cent of projects completed by January - the lowest rate in the past 15 years.

The CPD mentions that Bangladesh's tax-to-GDP ratio remains extremely low, around 6.8 per cent, and calls for comprehensive reforms to improve domestic resource mobilisation.

To strengthen the investment climate, Dr Khatun suggests simplifying business-registration procedures and reducing regulatory complexities.

The think-tank also recommends introducing tax incentives for digital infrastructure and establishing a special credit programme offering loans at interest rates of 3.0-5.0 per cent for environmentally sustainable small and medium enterprises.

The Centre further urges improvements in logistics and energy planning.

Among its proposals is also full automation of operations at Port of Chittagong to improve efficiency and reduce delays in trade and cargo handling.

The organisation also calls for a clear national roadmap for energy security, emphasising the need to strengthen electricity transmission and distribution alongside power generation.

The CPD notes that although the government has applied to the UN to extend time for the LDC graduation, it is still pending.

But the government should start rationalising the tariffs and incentives for the domestic industries as well as exploring regional trade agreements.​

 

[Saif]

FBCCI calls for policy continuity, tax reforms to boost investment in FY27 budget

The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) on Thursday urged the government to ensure policy continuity in the upcoming national budget for FY2026–27 to facilitate business expansion and maintain investor confidence amid ongoing global economic uncertainties. The

thefinancialexpress.com.bd

FBCCI calls for policy continuity, tax reforms to boost investment in FY27 budget

UNB
Published :
Mar 12, 2026 20:57
Updated :
Mar 12, 2026 20:57

The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) on Thursday urged the government to ensure policy continuity in the upcoming national budget for FY2026–27 to facilitate business expansion and maintain investor confidence amid ongoing global economic uncertainties.

The call came during a pre-budget consultation meeting with FBCCI’s member bodies held at the apex trade body’s Motijheel office in the city, where recommendations for the next fiscal budget were discussed.

In its proposals, FBCCI emphasised rationalising interest rates, increasing the tax-to-GDP ratio, full implementation of one-stop services for businesses, and modernising port and logistics management.

The organisation also called for ensuring uninterrupted power and energy supply, developing priority sectors to diversify exports, establishing a central bonded warehouse, and enacting stakeholder-based legislation.

During the open discussion, business leaders advised the government to expand the tax net to raise the country’s tax-to-GDP ratio. They also urged the National Board of Revenue (NBR) to strengthen transparency and accountability through automation and integration in tax policy, procedures and administration.

FBCCI Administrator Md Abdur Rahim Khan said the government aims to increase the tax-to-GDP ratio to 15 percent.

Assuring the business community, he said efforts to increase revenue collection would not necessarily lead to higher tax burdens on existing taxpayers. “Revenue growth will rather come through expanding the tax base.”

Rahim Khan also said FBCCI will present the rational proposals from the private sector at the 46th advisory committee meeting of the NBR.

Earlier, in his welcome remarks, FBCCI Secretary General Md Alamgir said the FY2026–27 budget is being prepared at a time when the global economy remains unstable, the energy market volatile and investment prospects uncertain.

“In such circumstances, preparing the national budget will be challenging for the new government,” he said, urging the business community to support the government by offering constructive and realistic proposals.

The meeting was attended by former NBR member and FBCCI Budget Expert Committee member Md Farid Uddin and Aminur Rahman, along with former FBCCI directors, leaders of various chambers and associations, and officials of the organisation.​

 

[Saif]

2026-27 budget must stabilise economy amid mounting pressures

The 2026-27 budget comes at a critical moment for the country.

www.thedailystar.net

2026-27 budget must stabilise economy amid mounting pressures
2 April 2026, 08:00 AM

Selim Raihan

VISUAL: ANWAR SOHEL

The government of Bangladesh, formed less than two months ago, finds itself at a delicate yet consequential moment as it enters the 2026-27 national budget cycle. The economy is not grappling with known cyclical ups and downs, but rather a combination of domestic constraints and external shocks. Growth has significantly slowed down compared to earlier years, inflation remains persistently high, foreign exchange reserves have yet to stabilise fully, there is mounting pressure on the exchange rate, and private investment continues to lag. At the same time, global uncertainties are becoming more pronounced. The ongoing crisis in the Middle East is already taking a toll on our economy through energy markets, remittance flows, and disruptions to trade logistics.

In this context, while the government has several election promises to deliver, it cannot treat the upcoming national budget as a routine fiscal exercise. Rather, it must serve as a strategic instrument to stabilise the economy in the short term, while also preparing for a more demanding transition, particularly in light of the country’s forthcoming graduation from the Least Developed Country (LDC) status.

External shocks and transmission channels

The Middle East crisis adds a new layer of unprecedented complexity to an already constrained macroeconomic environment. Its implications for Bangladesh are complex, and they work through various interconnected channels.

First is energy. Bangladesh’s heavy reliance on imported fuel exposes it to global price fluctuations. Persistent rises in oil and gas prices, as well as deep uncertainty about availability in time and sufficient quantity, would increase import and production costs, raise the current account deficit, and increase inflationary pressure. At the same time, continued reliance on fuel subsidies may not be fiscally sustainable. A gradual adjustment strategy, clearly communicated in advance, and complemented by targeted support to the most affected groups, would be more feasible. Meanwhile, the effort to diversify energy supplies and build renewable capacity must speed up.

Second is the remittance channel. A large portion of Bangladesh’s labour force works in Gulf countries. Any economic slowdown in those countries, or disruptions to labour markets linked to geopolitical instability, could conspire to reduce inflows of remittances. This would immediately impact household consumption and foreign exchange availability. Another risk is the possibility of return migration from the Middle East. Proactive planning is, therefore, essential. This also involves identifying who may return, what the capacity of the labour market is to absorb them, and how temporary support measures are shaped.

The third channel is trade and logistics. Disruptions to maritime routes and rising freight costs would hike import costs and erode export competitiveness. Combined, these channels indicate a scenario of higher inflation, tighter external balances, and weaker growth.

If the crisis persists and worsens, these pressures will increase. So the upcoming budget should be prepared with caution, keeping a long-term perspective in mind while also considering potential downside scenarios.

Aligning political commitments with fiscal realities

The government enters this budget cycle with a set of political commitments that are both ambitious and socially significant. The Family Card programme, support measures for agriculture, and broad reforms in social protection are all aimed at addressing structural inequalities and vulnerabilities.

These commitments are all the more crucial in a time of increasing economic stress. However, their efficacy will derive not only from scale but from design as well. The country’s social protection system has long been characterised by fragmentation, duplication, and leakage. Expanding the social protection programmes without fixing the structural problems would risk a rise in fiscal pressure without corresponding advantages. And in the context of high inflation, especially food inflation, protecting vulnerable households is an urgent task.

Hence, the budget should prioritise consolidation and integration. Developing a unified beneficiary registry, strengthening digital delivery mechanisms, and improving targeting criteria are essential steps. The budget must come up with a mechanism to shift focus from only the volume of expenditure to its effectiveness.

Revitalising investment and competitiveness

Reviving investment is central to restoring growth momentum. However, fiscal incentives alone are unlikely to suffice. Investor confidence depends on broader institutional and policy conditions. Hence, improving the business environment is critical. This includes enhancing the predictability of policy, strengthening transparency in regulatory issues, and increasing efficiency in public service delivery. Investment in large-scale infrastructure should continue, but be increasingly refocused on quality and connectivity as well as economic returns.

Foreign direct investment can supplement domestic endeavours; however, its growth will rely on further changes to trade policy, transportation, and governance systems. The impending LDC graduation also calls for the urgency of such reforms, since Bangladesh will have to compete in a much more demanding global environment with no preferential market access.

Monetary policy and financial sector reform

Monetary policy has already adopted a tightening stance in response to inflationary and external pressures. However, tighter monetary conditions also constrain investment and economic activities. Monetary policy effectiveness is closely tied to the soundness of the banking sector. Structural weaknesses, including high levels of non-performing loans (NPLs) and governance deficiencies, hamper financial intermediation. Therefore, it is vital to address these challenges. The budget needs to support a comprehensive reform agenda for the banking sector. The key will be to strengthen regulatory oversight, improve loan recovery frameworks, and enhance transparency. Without such reforms, the transmission of monetary policy will continue to be limited.

Fiscal policy and revenue mobilisation

Fiscal policy under the 2026-27 budget will have to balance competing demands in a context of a limited resource envelope. However, given limited fiscal space, the need for further support to households and key sectors must be balanced against new expenditures.

Fuel prices pose an especially complicated problem. Fuel taxes and levies are a key source of revenue, but they also have an impact on inflation dynamics. Therefore, fuel taxes and levies must be finely calibrated.

More fundamentally, the tax system needs to be reformed. Bangladesh has a low tax-GDP ratio, limiting its fiscal space. Expanding the tax base, improving compliance, and reducing reliance on distortionary taxes should be prioritised.

The 2026-27 budget comes at a critical moment for the country. This situation demands a budget that is not only prudent but also future-oriented. It needs to stabilise the present and set the stage for future competitiveness. Adapting policy and continued surveillance of changing conditions will be important. Ultimately, the effectiveness of the budget will depend on coherence across fiscal, monetary and structural policies. The challenges are daunting, but the opportunity to guide the economy towards a more resilient and sustainable path is still within reach.

Dr Selim Raihan is professor of economics at Dhaka University and executive director at the South Asian Network on Economic Modeling (Sanem).​

 

[Saif]

The Financial Express | First Financial Daily of Bangladesh

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Bringing truth back to land registration

MUHAMMED SHOWAIB

Published :
Apr 04, 2026 00:04
Updated :
Apr 04, 2026 00:04

As the National Board of Revenue embarks on its customary round of pre-budget consultations with business associations, economists, journalists and other stakeholders ahead of the upcoming national budget, the fiscal pressures bearing down on the government appear to be among the most acute in recent times. The budget for fiscal year 2026-27, expected to be presented on June 11, may reach approximately Tk 9 trillion, an enormous figure that demands equally enormous revenue mobilisation. Financing such an expansive budget is never easy, and it has become even more formidable under current economic conditions. Persistent inflation has strained government finances by squeezing household spending and, with it, the consumption-based tax revenues the government depends on. The economic turbulence radiating from conflicts in the Middle East has further deepened the crisis. Revenue collection has already struggled to keep pace with targets this year. What makes that all the more worrying is that the budget itself was already smaller than the previous year's, meaning even a relatively modest ambition has proved beyond reach. In the first eight months of the current fiscal year alone, the revenue shortfall has reportedly exceeded Tk 700 billion, and analysts warn that the annual shortfall may breach Tk 1 trillion before the fiscal year ends. Against this backdrop, the government has little choice but to look carefully at sectors where revenue leakage is both significant and preventable. The real estate and land registration sector stands out as precisely such a case.

For some time now, successive governments aspired to align registration values of land with actual market transaction prices, moving away from the existing mouza valuation system. The mouza rate, a government-assigned floor value for land in a given locality, is supposed to function as a minimum benchmark for registration purposes. In practice, it functions as the standard value at which virtually all transactions are registered regardless of what price actually changes hands. Most buyers and sellers opt to register deeds at the lower mouza rate to evade high registration fees, taxes and stamp duties leading to a situation where the surplus transaction occurs outside of formal banking channels. This not only deprives the national exchequer of potential revenue but also forces legitimate sellers into becoming holders of black money simply because they do not officially document the full proceeds of a sale.

Fortunately, policymakers have recognised this distortion. Their approach to address it through rationalisation of registration fees and taxes, alongside aligning registration values more closely with market rates, shows sound thinking. Reducing tax rates while expanding the base is a well-established principle of effective taxation, and if a buyer can register property at or near market value without facing prohibitive transaction costs, the incentive to under-report collapses. Transparency returns to the sector, government collects more revenue and housing market begins to function with greater integrity. Of course, these are outcomes worth pursuing.

However, even as the authorities move toward this logical alignment of values, somewhat ironically, one regulatory barrier exists that prevent many from registering properties accordingly. The problem concerns who actually bears the cost of registration and whose name appears in the documentation as the payer. Under existing withholding tax provisions, the legal obligation to pay the tax on a land or property sale rests with the seller. This is the position the law takes. The reality on the ground is almost universally different. More often than not, it is the buyer who bears the full cost of registration including the associated taxes, typically calculated at around 10 to 20 per cent of the transaction value. This is not a secret arrangement. It is standard practice, widely acknowledged, and embedded in how real estate deals are structured across Bangladesh. Yet because the documentation records the seller as the payer, a fiction is introduced at the very foundation of the transaction record.

Because the law assumes the seller pays the tax, the official documents show the seller as the payer. When the buyer tries to reflect this total expenditure in their tax file or loan application, they encounter a paradox where they cannot legally claim an expense that is documented under someone else's name. On the one hand, if the buyer reports the full amount, they risk a double counting conflict since the seller is also credited for that same payment by the revenue system. On the other hand, if the buyer says nothing, their actual financial outflow is understated. Either way, the formal record diverges from reality.

This divergence is not without consequence. It creates precisely the kind of ambiguity that invites corruption. When transactions cannot be properly documented without producing apparent inconsistencies, such situations give officials in authority the opportunity to insist on informal fixes. It also means that the return filing requirement, which the government has introduced as a gatekeeping mechanism to ensure that buyers and sellers accurately disclose their income, expenditure and asset acquisition costs, cannot fully serve its intended purpose.

The government's aim to formalise an economy that remains heavily informal and to build a tax base that reflects actual economic activity rather than its diminished official representation cannot be realised through rate adjustments alone. It requires that the formal documentation of every transaction honestly capture what occurred. In the case of land and property registration, that means ensuring that whoever actually bears the cost of registration and withholding tax is recorded as doing so. Put simply, if the buyer pays, the buyer must be able to show it.

As the government prepares its next budget, it has before it an opportunity to address the procedural inconsistency that undermines the credibility of financial transactions in the tax record. In this instance, revenue mobilisation and reform are not competing priorities. They are the same priority viewed from different angles. Closing the gap between who pays and who is shown to pay is but a modest administrative correction, yet one that would yield significant gains in transparency, accountability and the government's ability to account for what it is actually owed.​