Several tax rates, both for individual and corporate taxpayers, would come in a prospective manner in the FY26 budget, with effect from July 2026 in a bid to help taxpayers properly plan their taxes.
Individual taxpayers will enjoy an upward revision of their tax-free ceiling by Tk 25,000 from July 2026 on their income for the tax year 2025-26, officials said.
This means they would enjoy the tax-free ceiling of Tk 3,75,000 for FY27 and FY28.
But for the tax return on income for FY26, taxpayers have to pay taxes if their annual income exceeds Tk 3,50,000.
Besides, the corporate tax rate cut by 2.5 per cent for publicly-listed companies would come into effect on July 1, 2026.
For non-listed companies, the tax rate would be 27.5 per cent for those two years.
The Finance Ordinance 2025 to be placed before the nation by Finance Adviser Dr Salehuddin Ahmed today would come with the changes.
A major change in the income tax provision (section 21) would be incorporated in the ordinance to impose a penalty on the income of taxpayers who surrendered their Bangladeshi citizenship earlier.
The amendments are aimed at imposing penalties on S Alam Group's Saiful Alam, Summit Power's Aziz Khan, and former land minister Saifuzzaman Chowdhury for their undisclosed income made at home and abroad until they surrendered their citizenship.
Also, sponsor shareholders, director shareholders, and placement shareholders of listed companies will have to pay 15.0 per cent source tax, 5.0 percentage points higher, from July 1, 2025.
In the definition of the transfer of share, siblings would be included in the provision.
However, source tax on stock exchange members would be cut to 0.03 per cent from 0.05 per cent.
From July 1, 2025, the source tax on the purchase of power from captive plants would be reduced to 4.0 per cent from 6.0 per cent.
To realise taxes from siphoned money, a new provision has been incorporated in the tax law, making tax payments on domestic and foreign assets mandatory for individuals who have surrendered their Bangladeshi citizenship.
Freight forwarders will have to pay 1.5 per cent source tax on their gross bills or commissions, while cargo transportation would get relief from double taxation.
For approval of bad loans in tax files, taxmen have to incorporate the International Financial Reporting Standards (IFRS) with the existing International Accounting Standards (IAS).
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