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Prices of certain products and services are expected to increase in the 2025-26 fiscal year with the taxes and VAT on them increased in proposed national budget.
Finance Advisor Salehuddin Ahmed presented the Tk 7.9 trillion national budget for the 2025-26 fiscal year, reports bdnews24.com.
According to him, the budget is somewhat reform-oriented.
The proposed budget attempts to put in place a sustainable system that extends the benefits of development to everyone instead of limiting them to a select few.
PRODUCTS, SERVICES EXPECTED TO HAVE PRICE HIKE
# The budget proposes 20 percent rise in the specific taxes at the production level of ‘M S product.’
# The cost of construction work is likely to rise as the VAT rate for construction company services has been increased from 7.5 percent to 10 percent;
# Online sales commission has been imposed with a 15 percent VAT up from 5 percent.
# VAT rate at the production level of self-copy paper, duplex board, coated paper has been increased to 15 percent from 7.5 percent.
# Plastic tableware, kitchenware, household goods, hygiene and toilet products and similar products may see a price hike as the production level VAT has been pushed up to 15 percent from 7.5 percent.
# The specific tax amount at the production stage of “cotton yarn” has been fixed at Tk 5 per kg instead of Tk per kg. Hence, cotton yarn prices may go up.
# The VAT rate at the production stage of “yarn made of man-made fibre and other fibres” has been fixed at Tk 5 per kg instead of Tk 3 per kg. Therefore, prices of these products may rise.
# Using a blade for shaving may become costlier as the VAT rate at the production stage of blades has been fixed at 7.5 percent instead of 5 percent.
# In case of production of various types of screws, joints (connectors), nuts, bolts, electric line hardware and pole fittings including nails and bait, the VAT rate has been fixed at 7.5 percent instead of 5 percent.
#For some products, the existing VAT benefits have been reduced. This is likely to push the prices of those products slightly up.
# The existing VAT exemption at the manufacturing and assembly of mobile phones has been slightly reduced and extended till June 30, 2027. In both cases, the VAT will be increased by 2.5 percent.
# The existing VAT exemption at the local manufacturing stage of elevators has been slightly reduced and extended till June 30, 2030. So, elevator prices may go up.
# LPG cylinder prices may rise as the existing VAT exemption at the local manufacturing stage of LPG Cylinder has been slightly reduced and extended until Jun 30, 2027.
# The existing VAT exemption at the local manufacturing stage on washing machines, microwave ovens and electric ovens has been slightly reduced and extended until Jun 30, 2030, posing a possibility of a little price hike for those products.
# The existing VAT exemption for local manufacturing of blenders, juicers, mixers, grinders, electric kettles, irons, rice cookers, multi cookers and pressure cookers has been slightly reduced and the exemption period has been extended until Jun 30, 2030. Therefore, prices may increase a little.
# The existing VAT exemption for local manufacturing of four-stroke three-wheelers has been slightly reduced and the exemption period has been extended till June 30, 2030
# The VAT exemption for local manufacturing raw materials LABSA and SLES of soap and shampoo has been slightly reduced and the exemption period has been extended till June 30, 2027. Therefore, a little price hike of these products is expected.
# The existing VAT exemption facility for local manufacturing of refrigerators and freezers, air conditioners and their compressors, polypropylene staple fiber and idle start-stop batteries has been withdrawn. So, there can be an increase in the prices of these products.
# VAT exemption facility has been withdrawn from the import of sterile surgical catgut, surgical suture, lifts and skip hoists, set top-box and ballpoint pens. Hence, an increase of prices is expected.