Bangladesh has reversed years of policy that made electric vehicles unaffordable for most of its citizens. On June 11, 2026 C.E., finance minister Amir Khosru Mahmud Chowdhury unveiled a sweeping set of tariff changes in parliament — cutting taxes on electric buses, trucks, and charging infrastructure to zero while raising tariffs on diesel, petrol, and octane-powered vehicles.
At a glance
- EV tax reform: Bangladesh’s government proposed full import duty exemptions on electric buses and trucks, extended until June 30, 2030 C.E., alongside a cut in charging station taxes from 39.75% to 0%.
- Fossil-fuel tariffs: Tariffs on fuel-powered private vehicles with engine capacities between 1,200 and 1,600 cc rose from 132% to roughly 156%, making the price gap between old and new technology much more visible.
- Air pollution burden: UN estimates put annual deaths linked to air pollution in Bangladesh at more than 235,000, with hundreds of thousands more affected by asthma and other respiratory illnesses.
Bangladesh’s transport sector accounts for 9% of the country’s greenhouse gas emissions. Thousands of diesel-run buses and trucks drive through cities like Dhaka and Chattogram daily, and the resulting smog has pushed air quality in both cities into the dangerous range on most days of the year. This package is the first coordinated government attempt to modernize that system.
What the policy covers
The finance minister’s proposals are broad. Electric buses and trucks gain full import duty exemptions — except value-added tax — through mid-2030 C.E. Registration fees for electric private cars fall, and supplementary duty is reduced depending on vehicle type. The government is also offering a 0% tax rate on the solar power sector until 2035 C.E. and a 5% tax rebate on solar electricity bill payments.
Plug-in hybrid vehicles with engine capacities up to 1,800 cc benefit from the full withdrawal of regulatory duty. The government has also proposed cutting total tax on EV chargers and charging stations from 39.75% to 0%, which backers say is essential to making any transition workable in practice.
Bangladesh’s Department of Environment framed the move within the country’s Nationally Determined Contribution — its formal climate pledge. “Bangladesh always prioritizes adaptation, but now we are going for mitigation as well,” Mirza Shawkat Ali, director of the climate change cell, told Mongabay. The stated goal is 25% electric buses and trucks and 30% electric private cars on the road by 2035 C.E.
Bangladesh is one of many nations making serious strides in climate progress by redesigning the incentives that shape how people get around.
Real barriers to a smooth transition
Experts and industry voices welcome the direction but flag significant practical gaps. Saiful Islam, a leader of the Bangladesh Bus-Truck Owners Association, told Mongabay that electric buses and trucks cost roughly triple the price of diesel-powered equivalents and would require entirely new infrastructure — charging stations, skilled technicians, spare parts, and supply chains that do not yet exist in the country.
He also raised a less obvious friction point: recharging time. A diesel bus can refuel in five minutes at a roadside station. If an electric bus requires 30 minutes at a charger, operators worry passengers will simply refuse to board. “Unless the government gives us policy support, we cannot go ahead,” Islam said.
Provat Saha, a former engineering professor at the Bangladesh University of Engineering and Technology, called the move laudable but questioned whether it would be enough to move the needle on air quality. He noted that the heaviest polluters — large trucks and lorries — are not yet available as electric models at scale. Anisur Rahman, a marketing professor at Dhaka University, urged the government to have conducted a feasibility study before launching, and to ensure service quality is high enough that passengers accept the shift without complaint.
A historic reversal of EV policy
The previous government had set tariffs that pushed EVs out of reach for most Bangladeshis. This budget reverses that direction entirely. Because the ruling party holds more than two-thirds of the seats in the unicameral legislature, passage of the proposals is considered near-certain.
The story echoes moves elsewhere in the developing world. Ethiopia banned fossil-fuel vehicle imports entirely, betting that a hard cutoff would accelerate the shift faster than incentives alone. Bangladesh is choosing a softer path — making EVs cheaper to import while making combustion vehicles more expensive to register and own. Neither approach is without risk, but both signal that the era of unquestioned diesel dominance on Asian roads is ending.
In the U.K., similar policy logic has been applied to the electricity grid itself — Britain recently ran its grid on zero-carbon electricity for a record stretch, demonstrating what the destination of these transitions can look like. Bangladesh’s road there will be longer and bumpier, but the direction is now set in law.
Read more
For more on this story, see: Mongabay
For more from Good News for Humankind, see:
- Ethiopia bans fossil-fuel vehicle imports in landmark EV push
- Britain’s electricity grid runs on zero-carbon power for a record stretch
- The Good News for Humankind archive on climate progress
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