MCCI Hails FY27 Budget as Bold Move for Economic Recovery
The Metropolitan Chamber of Commerce and Industry (MCCI) has described the proposed national budget for fiscal year 2026-27 as a bold initiative aimed at accelerating economic recovery, generating employment and fulfilling the government's electoral commitments. In its official reaction issued today, the MCCI congratulated Finance and Planning Minister Amir Khosru Mahmud Chowdhury for presenting the Taka 938,000 crore budget, the first under the newly elected government.
The chamber noted that the budget has been formulated amid significant economic challenges, including persistent inflationary pressure, global geopolitical uncertainties, elevated interest rates and sluggish investment growth. MCCI welcomed the government's targets of achieving 6.5 percent GDP growth and reducing inflation to 7.5 percent in the coming fiscal year.
It also appreciated the identification of 10 priority areas aimed at restoring economic discipline and providing relief to citizens. MCCI also welcomed the proposed allocation of Taka 144,338 crore for social safety net programmes, a 13.89 percent increase from the previous fiscal year.
It particularly appreciated initiatives such as family cards for low-income households and farmer cards that will provide financial assistance through mobile banking channels. The chamber also praised the increased allocations for education and health sectors, with education spending projected to rise to 2.0 percent of GDP and health expenditure to 1.01 percent of GDP. On taxation, MCCI appreciated several business-friendly measures, including raising the tax-free income threshold for individuals to Taka 375,000, introducing a tax calendar under the Income Tax Act 2023, reducing tax payment requirements for appeals, recognizing labour as an input for VAT purposes and shifting VAT return submission from monthly to quarterly.
At the same time, it urged the government to reconsider the proposed increase in the minimum tax rate from 5 percent to 10 percent and the reduction of the investment tax rebate from 15 percent to 10 percent, warning that these measures could discourage savings and penalize compliant taxpayers. The chamber also expressed disappointment over the absence of a refund mechanism for the Minimum Turnover Tax and stressed the need for strong legal and technological safeguards to protect data privacy under new digital connectivity initiatives.
MCCI emphasized that the ultimate success of the budget would depend on institutional good governance, a harassment-free tax regime and efficient revenue administration. It called for full digitalization of tax management and the adoption of risk-based audit systems to improve compliance while fostering a more business-friendly environment. The chamber reaffirmed its commitment to working with the government to ensure economic stability, sustainable growth and inclusive development.
