The Consumers Association of Bangladesh (CAB) today demanded that the government refrain from hiking VAT and supplementary duty (SD) until the end of the fasting month of Ramadan, warning that the move would exacerbate the financial struggles of low and middle-income families.

The appeal comes two days after the National Board of Revenue (NBR) hiked VAT and SD on nearly 100 products and services, including mobile and internet services, medicines, LP gas, biscuits, sweets, fresh fruits and raw construction materials to increase revenue collection.
This move, recommended by the International Monetary Fund (IMF), has drawn sharp criticism from various quarters, including economists, businesses, political parties, and commoners.

CAB, in a statement, highlighted the steady rise in food inflation throughout 2024, with rates hovering around 13 percent in December, and said elevated inflation has already left many families struggling to manage their daily necessities.

CAB expressed concern that the VAT and SD hike would fuel inflation further, providing unscrupulous traders with an excuse to raise prices.

With Ramadan approaching in March, traders have reportedly begun hoarding essential items such as oil, sugar, lentils, and spices.Despite lower prices for winter vegetables, rice prices have risen by Tk 10–15 per kilogram, adding to the burden on consumers, it said.

CAB criticised the lack of oversight in implementing previous VAT reductions, which, it said, benefited corporate groups instead of consumers.

They also urged the government to expand the VAT net, curb tax evasion, and increase direct taxes rather than increasing the burden on low-income families with higher indirect taxes.

The CAB warned that if immediate steps are not taken, the VAT hike would severely disrupt the lives of marginalised communities, especially during Ramadan.