The proposed national budget for FY2025–26 has failed to address the ongoing economic challenges in the country, speakers said at a dialogue organised by the Centre for Policy Dialogue in Dhaka on Sunday.
The proposed budget was presented on June 3 and approved later on Sunday afternoon.
Some measures — such as tax exemptions, incentives for key sectors, and higher taxes on harmful activities — were seen as positive. However, several revenue steps contradict the budget’s specified aim of building an equitable and sustainable economy, they observed.
CPD executive director Fahmida Khatun presented the keynote, with distinguished fellow Mustafizur Rahman and former caretaker government adviser Hossain Zillur Rahman joining the discussion.
The budget promised to prioritise people over physical infrastructure, but lacks adequate allocations or actionable steps to realise these goals, they said.
Fahmida said while the budget is smaller than the previous year’s and shifts attention from GDP growth to broader human development, its effectiveness is questionable due to weak institutional and structural reforms.
Without a clear roadmap for structural changes, revenue generation will remain insufficient and implementation risks will persist, she warned.
The CPD stressed the need for a midterm review of the budget to identify shortfalls and ensure transparency.
It criticised overly optimistic macroeconomic projections, a fragile fiscal framework, and a public expenditure plan that remains disconnected from strategic priorities. Inflation control measures are also seen as inadequate, while key social sectors remain underfunded.
Although allocations for youth and employment are positive, issues like climate change and gender equality continue to receive limited attention, she added.
Fahmida criticised the proposed adjustment to the tax-free income threshold — from Tk 3.5 lakh to Tk 3.75 lakh — as minimal and delayed, with the change only coming into effect in FY2026–27. The measure, she said, does nothing to ease the current inflationary burden on households.
She explained that the budget may intensify the tax load on middle-income earners — especially those earning between Tk 6 lakh and Tk 16 lakh annually — while those with incomes above Tk 30 lakh would continue to enjoy lower effective tax rates.
This disparity, Fahmida argued, reveals systemic inequality in the tax regime.
In addition, she said that the government has acknowledged inflation as a major concern, but the proposed budget fails to provide sufficient tools to address it. The burden of rising prices is falling disproportionately on low- and fixed-income groups.
Mustafizur Rahman said that that the interim government’s budget has fallen short of expectations, especially after the political shift in August.
He said the budget should have taken a redistributive approach — imposing higher taxes on the wealthy to strengthen public services such as education, healthcare, and food security.
About two-thirds of revenue is projected to come from indirect taxes, disproportionately affecting the poor and contradicting the budget’s stated goals, he said.
Hossain Zillur Rahman said the unresolved issue of ghost cases has thrown the business environment into deep uncertainty, leading to investment stagnation.
He criticised the absence of measures to restore confidence. Addressing the investment crisis requires coordination across the government — from the finance ministry to the judiciary, he said.
Zillur Rahman stressed that major budgetary decisions demand bold political will. Without such initiative, he warned, no real change would happen.
The event was also attended by Rumeen Farhana, assistant international affairs secretary of the Bangladesh Nationalist Party; Enamul Haque Khan, senior vice-president of BGMEA; and Showkat Aziz, president of BTMA.
