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'Prospective tax' system on cards

FE REPORT | June 07, 2024 00:00:00

Bangladesh is going to frame 'prospective tax' annually to facilitate investors predict the rate for next year with an eye to making a proper business plan with its operation cost.

In the Finance Bill-2024, finance minister Abul Hassan Mahmood Ali proposed the measure that has long been demanded by both local and foreign investors.

He suggested retaining the proposed tax rate for 2024-25 for the assessment year 2025-26 to facilitate the expansion of trade, improve investor confidence in the tax system and encourage local and foreign investment.

"Through a prospective tax system, I believe, taxpayers can do proper tax planning and help increase tax compliance," said Mr Ali.

AKM Badiul Alam, income tax member of the National Board of Revenue, said both individual and corporate taxpayers would be able to enjoy a predictable tax regime from now on.

"We have introduced the tax this year, so the new rate would be applicable to last fiscal's income and also for FY 2025-26," he added.

The government would propose the tax rate for FY 2026-27 in the next fiscal budget, he added.

According to former income tax member Apurba Kanti Das, the tax system is a long-cherished demand of the investors as it helps make proper tax planning by them.

"Frequent tax changes impact businesses and create complexities in their smooth operations," he added.

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