In a transformative policy shift, Bangladesh has eliminated import tariffs on electric buses, trucks, and charging infrastructure, effective until mid-2030, as part of a government-led effort to curb harmful transport emissions. This move aligns with the country’s Nationally Determined Contribution (NDC) targets to reduce carbon emissions and address severe air pollution health impacts.
The tariffs on fossil fuel-powered vehicles have been increased, while electric vehicles (EVs) enjoy reduced registration fees and tax exemptions to encourage widespread adoption. Furthermore, the government introduced incentives for solar energy production and consumption, including a zero-tax rate on the solar power sector through 2035 and rebates on solar electricity payments. These integrated measures aim to accelerate the replacement of at least 25% of buses and 30% of trucks with electric alternatives.
Pollution from diesel-powered transport remains a critical public health issue in Bangladesh's major cities such as Dhaka and Chattogram, contributing significantly to the estimated annual death toll of over 235,000 related to air pollution. The new policy signals a decisive step toward modernizing the nation’s transport system by cutting greenhouse gas emissions from a sector responsible for nearly 9% of the country’s total emissions.
The finance minister articulated that establishing a nationwide EV charging network is key to facilitating this transition. To support infrastructure growth, the government has waived taxes on EV chargers and charging stations, reducing the tax burden from nearly 40% to zero. Additionally, regulatory duties on new plug-in hybrid vehicles with smaller engines have been fully withdrawn to enhance incentives.
These comprehensive adjustments in tariff and tax policies for the upcoming fiscal year reflect Bangladesh’s strategic commitment to both mitigating climate change and improving public health by addressing the root causes of urban air pollution.