DCCI expresses concerns over increases in VAT and gas prices

DCCI Voices Concerns Over Gas Price Hikes and VAT Increases

The Dhaka Chamber of Commerce & Industry (DCCI) has expressed deep concern over proposed increases in industrial gas prices and VAT, warning that these measures could disrupt business operations, deter investment, and weaken export competitiveness.

Petrobangla has recently submitted a proposal to the Bangladesh Energy Regulatory Commission (BERC) to more than double the per-unit gas price for industrial and captive consumers, raising rates from Tk 30 and Tk 31.50 to Tk 75.72. This proposal aims to reduce the government’s subsidy burden on gas production.

At the same time, the National Board of Revenue (NBR) has raised income tax rates for manufacturers of motorcycles, refrigerators, air conditioners, and compressors from 10% to 20%, reversing an earlier promise to maintain reduced rates until 2032.

Rising Costs and Inflationary Pressures

In a statement, the DCCI emphasized that these policies, if enacted, would substantially increase production costs, placing additional inflationary pressure on both industries and consumers.

“The proposed gas price hikes, without guaranteeing an uninterrupted supply, pose a significant challenge for businesses,” the statement noted. “Such increases will drive up the cost of doing business, reducing profitability for domestic and export-oriented industries and eroding Bangladesh’s competitiveness in global markets.”

The DCCI further criticized the abrupt withdrawal of tax incentives, stating that inconsistent policies could damage Bangladesh’s reputation as an investment-friendly destination.

“This reversal sends a negative signal to both local and foreign investors, undermining confidence and casting doubt on the reliability of policy commitments,” the chamber warned.

A Call for Policy Reconsideration

The DCCI urged the government, BERC, and Petrobangla to reassess the proposed gas price hikes. It also called for a review of VAT and tax increases, cautioning that such measures could exacerbate inflation and operational costs for businesses during a period of global economic uncertainty.

“To achieve sustainable economic growth, it is critical to maintain a stable and business-friendly environment,” the DCCI said. “This requires consistent long-term policies, tax incentives, and active collaboration between the government, private sector, and other stakeholders.”

Broader Impacts

The proposed tax increases on manufacturing industries such as motorcycles, refrigerators, and air conditioners come at a time when businesses are already facing economic instability.

The DCCI warned that these measures could stifle local industrial growth, discourage foreign investment, and hinder economic recovery.

Amid ongoing global challenges, the DCCI stressed the importance of “cost-effective policies that ensure continuity and stability.” It warned that policy reversals and steep cost increases risk undermining efforts to attract investors and sustain Bangladesh’s economic momentum.