Reform-oriented budget to strengthen economy: BGMEA

Garment exporters have welcomed the proposed national budget for the fiscal year 2026-27, describing it as a balanced and reform-oriented roadmap aimed at strengthening macroeconomic stability, improving the business climate and supporting long-term economic transformation.

In its reaction to the proposed budgetary measures, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) praised the finance minister for pursuing policy continuity and maintaining economic discipline amid persistent global uncertainties and domestic challenges.

BGMEA, the main trade body representing the country’s largest export earning sector, said proposed budget reflects a shift from a purely growth-driven strategy toward a broader development agenda that places greater emphasis on education, healthcare and social protection.

It said the government sets economic growth target of 6.5 percent for the next year and has outlined 10 strategic priorities, including investment-led employment generation, promotion of a production-oriented economy, deregulation, financial sector stability and energy security.

These priorities are expected to play an important role in supporting industrial expansion, export growth and Bangladesh’s smooth transition from least developed country status, said the BGMEA.

The proposal to maintain tax policy consistency for at least five years and gradually reduce reliance on statutory regulatory orders through the introduction of a risk-based audit system is expected to strengthen investor confidence and encourage fresh investment, it added.

BGMEA appreciated several measures aimed at improving revenue administration and reducing compliance burdens.

These include the introduction of an automated and faceless tax refund system, treatment of withholding tax as advance tax rather than minimum tax, and simplified tax procedures. Such reforms are likely to improve transparency and ease cash-flow pressures for businesses.

It said mandatory online-based single-window services, issuance of licenses within seven days and company registration within 48 hours are expected to reduce bureaucratic hurdles and lower the cost of doing business.

The association also welcomed initiatives to facilitate profit repatriation and expedite work permits for foreign professionals.

The trade body further welcomed the reduction of tax on recycled products from three percent to one percent and the continuation of duty exemptions on effluent treatment plant chemicals, measures that are expected to encourage environmentally responsible manufacturing.

It also urged the government to withdraw the proposed 5 percent import duty on polyester staple fibre, along with additional duties on PVC resin and PET resin, citing the growing export potential of man-made fibre-based garments.