The Consumers Association of Bangladesh (CAB) yesterday urged the government to refrain from implementing the VAT and supplementary duty (SD) hike until the end of Ramadan, warning that the move would worsen the financial struggles of low- and middle-income families.

The appeal came two days after the National Board of Revenue (NBR) increased VAT and SD on nearly 100 products and services, including mobile and internet services, medicines, liquefied petroleum (LP) gas, biscuits, sweets, fresh fruits, and raw construction materials, to boost revenue collection.

This decision, reportedly recommended by the International Monetary Fund (IMF), has faced sharp criticism from various groups, including economists, businesses, political parties, and ordinary citizens.

In a statement, CAB highlighted the steady rise in food inflation throughout 2024, which reached around 13 percent in December. The association noted that elevated inflation has already left many families struggling to afford their daily necessities.

CAB expressed concern that the VAT and SD hike would further drive up inflation, giving unscrupulous traders an excuse to raise prices.

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

The association criticised the lack of oversight in implementing previous VAT reductions, claiming that corporate groups benefited from the measures rather than consumers.

CAB also urged the government to expand the VAT net, curb tax evasion, and increase direct taxes instead of burdening low-income families with higher indirect taxes.

The association warned that if immediate action is not taken, the VAT hike could severely disrupt the lives of marginalised communities, especially during Ramadan.