The Centre for Policy Dialogue (CPD) has urged the government to raise the tax-free income limit to Tk4 lakh in the upcoming fiscal year’s budget, citing the mounting pressure of inflation on households.
CPD Executive Director Fahmida Khatun made the recommendation on Sunday (16 March) at an event organised by the think tank to discuss budgetary proposals for the fiscal year 2025-26.
"Inflation exhibited an upward trajectory from July to February, with food inflation surpassing non-food inflation. Notably, food inflation in rural areas was significantly higher than in urban regions. People are depleting their savings simply to afford food," she stated.
"In this scenario, it is rational to increase the tax-free income limit. Therefore, we propose that it be raised to Tk4 lakh in the forthcoming fiscal year," she added.
Fahmida also cast doubt on the Bangladesh Bank’s objective of reducing inflation to 7-8% by June, asserting that such a target would be unattainable under current economic conditions.
The government had set the tax-free income threshold at Tk3.5 lakh in the current fiscal year’s budget.
