by
On June 20, 2025, Dr. Salehuddin Ahmed, the Finance Adviser, proposed a Tk 7.90 lakh crore budget for the 2025-26 fiscal year, emphasizing inflation control, job creation, enhanced social security, and an improved business environment. However, a proposed tax increase on locally produced yarn has drawn sharp criticism from spinning mill and weaving industry owners.
According to the budget proposal, the tax on domestic cotton yarn, widely used in the weaving industry, has been raised from Tk 3 to Tk 5 per kilogram. In contrast, the tax on synthetic yarn has been reduced from Tk 6 to Tk 5 per kilogram. This decision to lower taxes on imported yarn while increasing taxes on locally produced yarn has sparked outrage among stakeholders in the spinning and weaving sectors.
The Sirajganj Chamber of Commerce has demanded a reduction in the tax on domestic yarn, arguing that the hike will increase production costs for weavers, ultimately leading to higher cloth prices. Saidur Rahman Bacchu, President of the Sirajganj Chamber of Commerce, stated, “The increased tax on local yarn will raise production costs for weavers, resulting in higher cloth prices. This will directly impact consumers.” He further warned that the decision could undermine the competitiveness of the local weaving industry.
Industry stakeholders fear that the tax hike will inflate production costs, which will likely be passed on to consumers, increasing the price of clothing. They have urged the government to reconsider the decision to support the local weaving industry and protect consumers from rising costs.
AI/MR
