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The LPG Operators Association of Bangladesh (LOAB) has strongly opposed the government’s proposal to increase Value Added Tax (VAT) on Liquefied Petroleum Gas (LPG) cylinders from 7.5 per cent to 10 per cent.
They warned that the move could severely destabilise the country’s energy security and hurt millions of low-income families, UNB reports.
LOAB President Muhammed Amirul Haque in a statement said the proposed tax hike poses a ‘serious threat’ at a time when domestic natural gas reserves are dwindling and new household gas connections have already been suspended.
“LPG is the primary alternative fuel for millions of families. Increasing VAT will make it less affordable and limit access for those who need it the most,” he said.
According to LOAB, more than 1.5 million tons of LPG are imported annually by the private sector with 97 per cent of it used for cooking.
The usage is equivalent to approximately 2 million cubic feet per day (mmcfd) of natural gas and supports over 40 lakh households across the country.
Amirul Haque said the widespread use of LPG plays a critical role in reducing deforestation especially in rural areas where it replaces traditional biomass fuels like firewood.
“With more than 4 crore LPG cylinders in circulation and rising demand each year, this tax increase could not only threaten clean energy adoption but also place an undue burden on low-income consumers,” he added.
LOAB has called on the government to reconsider the proposed VAT increase in the interest of national energy security, environmental sustainability, and public welfare.