The income tax in Bangladesh is administrated by the Income Tax Ordinance
1984 and by Income tax Rules, 1984. Income Tax wing of the National Board
of Revenue (NBR) is the apex body of matters relating to income tax which
is manned by the officers of income tax department. At the top, there are
position for four mambers of NBR in the income tax wing. The income tax
members report to the chairman, NBR who is a secretary to the government
and in charge of Internal Resources Division (IRD), Ministry of Finance.
There are seven heads of income as per existing law. Those are salary,interest
on security, house property, agriculture, business and profession, capital gain and
other sources.
Submission of income tax return is generally due by 30th september in case of
entities other than companies and by 31st December in case of companies.
Tax assesment can be done following several procedures which are e.g, self
assesment, presumptive assesment, spot assesment, pre - audit based assesment
etc. Certain percentage of self assesment cases are selected for audit.
The present rate of tax is as follows:
|
Publicly traded companies: ------
|
35%
|
|
Other Companies, banks, financial institutions -----------------
|
40%
|
|
Resident individuals -------------
|
10% - 25% with a threshold of taka 75,000/-
|
Tax incentives are given in many areas. Namely-
(a) Tax holiday for 5/7 years for industrial unit, physical infrastructure facility and tourist industries;
(b) Computer data entry and software development is treated as industry for tax holidays purpose;
(c) Income from fisheries, livestock, poultry etc. is exempted from tax up to June 30, 2005.
(d) Income of power generation companies set up in the private sector are exempted from tax for 15 years.
(e) Income of industries set up in the Export Processing Zone is exempted from tax for 10 years;
(f) Income from hospitals set up in the private sector is exempted form tax up to June 30, 2005.
Agreement on Avoidance of Double Taxation is in force with 20 countries. They are:
Belgium, Canada, China, Denmark, France, Germany, India, Italy, Japan, Malaysia, Netherlands, Pakistan,
Poland, Republic of Korea, Romania, Singapore, Sri Lanka, Sweden, Thailand and United Kingdom and Northern Ireland.
Negotiation for agreement is completed and legal process in underway with-
Bahrain, Egypt, Indonesia, Mauritius, Norway, Philippines, Turkey.
Negotiation is underway with-
Iran, Nepal, Russian Federation, South Africa, United State of America.
|
