The Bangladesh government has proposed sweeping tax concessions for the semiconductor industry, including reducing import duties on key raw materials to 1 percent until mid-2031, as part of its fiscal year 2026-27 budget.

Semiconductors are a critical component in modern electronics, powering products ranging from smartphones and computers to industrial equipment and vehicles. 

Under the proposal, raw materials used in semiconductor and chip design, testing and packaging would be exempt from regulatory duty, supplementary duty, value-added tax and advance tax. A 1 percent import duty would remain in place. The concessions would apply until 30 June 2031.

Presenting the budget, finance and planning minister Amir Khosru Mahmud Chowdhury said, “Every year, our universities produce many qualified engineers, and many more are contributing globally as part of the Bangladeshi diaspora.”

The proposed incentives are aimed at leveraging that talent pool, creating skilled jobs and supporting export-oriented growth, according to the minister.