Health budget allocation in FY2027 is 6.70 per cent of the total budget and 0.92 per cent of the GDP, nearing the long-standing target of 1 per cent of GDP after remaining below this threshold for nearly two decades. Development expenditure overtook non-development expenditure for the first time since FY2017, shifting the development share of total health budget from 42 per cent to 56 per cent. Positive fiscal measures in FY2027, including VAT and advance tax exemptions on dialysis filters, coronary stents (heart rings), and intraocular lenses, are undercut by a fragmented and inadequate tobacco, bidi, and sugar-sweetened beverage tax structure that keeps such products comparatively affordable.

Authors: Afrin Mahbub and Ayesha Suhaima Rab
Publication Period: June 2026