BARVIDA seeks rollback of proposed tax hike on mid-range reconditioned cars

The Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) has urged the government to withdraw the proposed tax increase on mid-range fossil fuel-powered reconditioned cars, warning that it would significantly raise vehicle prices and hurt both consumers and government revenue.

At a press conference at Dhaka Club today (20 June), BARVIDA President Abdul Haque also called for equal customs benefits for brand-new and reconditioned plug-in hybrid vehicles, along with broader policy support for hybrid cars.

According to the association, the proposed FY2026-27 budget splits the existing 1-1,500cc engine category into two slabs, 1-1,200cc and 1,201-1,600cc, raising the overall tax burden on popular fuel-efficient reconditioned vehicles from 132.36% to 159.80%.

BARVIDA estimates that the higher taxes would increase the price of a reconditioned Toyota Premio by around Tk3 lakh and a Toyota Axio by about Tk2.5 lakh, making car ownership more difficult for middle-income buyers.

The association also criticised the proposed duty structure for plug-in hybrid vehicles, saying that while brand-new imports have received tax concessions, reconditioned models will continue to face a 5% regulatory duty.

It urged the government to apply the same supplementary and regulatory duty rates to both categories.

BARVIDA argued that although the budget promotes electric vehicles through tax incentives, Bangladesh still lacks adequate EV charging infrastructure, whereas hybrid vehicles already benefit from an established support network.

It therefore called for similar policy incentives for conventional hybrid vehicles.

The association said the reconditioned vehicle sector has attracted around Tk20,000 crore in local investment, generates about Tk6,000 crore in annual revenue and supports several hundred thousand jobs directly and indirectly.