The Centre for Policy Dialogue (CPD) on Sunday said that the proposed budget for FY27 created inequality in the personal income tax structure.
According to the think tank, the tax burden on relatively low and middle-income earners has been increased more in the new tax structure, while the rate of increase in tax liability for high-income taxpayers has been kept relatively low.
CPD executive director Fahmida Khatun made these observations at a dialogue titled “Review of the Proposed Budget 2026-27” organized in the capital.
Finance Minister Amir Khasru Mahmud Chowdhury was present as chief guest.
Zonayed Abdur Rahim Saki and NCP’s Syed Akhter Hossain were present as special guests in the dialogue, chaired by CPD Distinguished Fellow Prof Mostafizur Rahman.
Presenting the main paper, Fahmida Khatun said that analyzing the impact of taxes on different levels of taxable income, it has been found that those whose annual income is between Tk6 lakh and Tk15 lakh, their tax liability will increase by 12.5% to 16.7%.
On the other hand, for those earning more than Tk30 lakh annually, the tax liability will increase by only 7.6%.
She said: "One of the objectives of the tax system is to reduce income inequality and ensure social justice. But that goal has not been properly reflected in the proposed tax structure. Rather, people with comparatively low incomes will be more pressured."
The CPD also questioned the government's election promise of creating 10 million new jobs in the next 18 months. According to the organization, the proposed budget does not clearly reflect the policies and financial allocations required to implement this goal.
Fahmida Khatun said that the budget allocation of the Ministry of Labor, Expatriate Welfare, Industry and Commerce has either decreased in proportion to the total expenditure, or has stagnated. At the same time, important employment-oriented projects such as Patuakhali EPZ and Jamdani Village have been waiting for implementation for a long time.
“Without a specific national employment program, skill development and necessary reforms, there is a risk that the target of creating 10 million jobs will remain a political aspiration.”
In the proposed budget, the government has set a target of reducing inflation to 7.5% in the next fiscal year. However, according to CPD, the average inflation rate till May of the outgoing fiscal year was 8.63%, so achieving the target will not be easy.
Fahmida Khatun said that without improving the food and energy supply system, effective measures in market management and prudent monetary policy, achieving the target of controlling inflation will be difficult.
In the assessment of CPD, although the target of economic recovery set in the first budget of the new government is positive, the government’s forecast on various macroeconomic indicators is quite optimistic.
The organization believes that increasing allocations to human resource development sectors including education and health is a commendable initiative. However, the biggest challenge, as per past experience, will be to ensure effective implementation of these allocations.
Participants in the budget dialogue made various recommendations on tax structure, employment, inflation control, industrialization and investment climate development. According to them, to bring the economy back on the path of sustainable growth, special emphasis should be placed on reforming the revenue system, effective initiatives for job creation and proper implementation of allocations for human resource development.
