Budget FY2026-27 Relief for Common People as Daily Commodity Taxes Slash

The proposed national budget for fiscal year 2026-27 includes several measures aimed at easing the burden on households affected by inflation. Finance Minister Amir Khasru Mahmud Chowdhury presented a Tk 9.38 lakh crore budget in Parliament, highlighting tax relief, lower costs for essential goods, healthcare support, and expanded social protection initiatives.

Tax-Free Income Limit Increased

One of the most significant proposals for middle-income earners is the increase in the tax-free income threshold. The limit has been proposed to rise from Tk 3.5 lakh to Tk 3.75 lakh annually.

The proposed tax-free threshold for women and taxpayers aged 65 and above has been set at Tk 4.25 lakh. For third-gender individuals and persons with disabilities, the tax-free limit has been proposed at Tk 5 lakh. The budget also includes special tax benefits for those injured during the July uprising.

Lower Taxes on Essential Commodities

To help stabilize market prices, the government has proposed reducing source tax on 60 essential products, including rice, pulses, wheat, potatoes, onions, garlic, ginger, edible oil, sugar and salt.

The source tax on these products currently ranges between 2% and 5%. Under the proposal, it would be reduced to 0.5%, a move expected to lower import and supply costs and potentially reduce retail prices.

Measures to Reduce Healthcare Costs

The budget proposes withdrawing all taxes and VAT on imported dialysis filters, which could reduce dialysis costs for kidney patients by around Tk 800 per session.

Tax exemptions have also been proposed to lower the prices of cardiac stents and intraocular lenses, potentially reducing treatment expenses for heart and eye patients.

Mobile and Internet Services

The proposed budget includes the withdrawal of the Tk 300 tax on mobile SIM cards. The source tax on mobile network services has also been proposed to be reduced from 12% to 10%.

If implemented, these measures could make mobile communication and internet services more affordable for consumers.

Benefits for Senior Citizens

The Finance Minister announced new benefits for senior citizens, including free train travel and a 25% fare discount on metro rail services for citizens aged over 65 years. These measures are intended to improve mobility and accessibility for older people.

Expanded Social Protection

The budget proposes distributing Family Cards to 41 lakh women. Under the programme, eligible cardholders would receive a monthly allowance of Tk 2,500.

The disability allowance has also been proposed to increase to Tk 1,000 per month, benefiting approximately 3.8 million recipients.

New Pay Scale for Government Employees

The government has announced plans to introduce a new pay scale for public-sector employees from July 1, 2026. The move is intended to help offset the impact of inflation and improve living standards.

Budget Size and Financing

The proposed budget for FY2026-27 has been set at Tk 9,38,000 crore under the theme, “Journey Towards a Democratic, Humane and Inclusive Economy.”

The government has set a revenue target of Tk 6,95,000 crore, creating a budget deficit of Tk 2,43,000 crore. To finance the gap, Tk 1,16,000 crore is expected from foreign loans and grants, while Tk 1,27,000 crore will be raised from domestic sources.

Of the domestic financing, Tk 1,12,000 crore is expected to come from the banking system, while Tk 15,000 crore will be raised through savings certificates and other instruments.

In his budget speech, the Finance Minister said the government's goal is to stabilize markets, ease pressure on consumers and build a more inclusive economy.