The Cabinet on Thursday last approved the Income Tax Law-2023 with major changes to some provisions of the existing income tax law, sources said.
The new law is set to be placed in parliament on Wednesday.
If approved, no tax deducted in advance from interest earned from securities would be considered for refund or carrying forward.
Currently, the government is collecting direct tax under Income Tax Ordinance-1984. There was a full-fledged income tax act in 1922.
From the upcoming fiscal year (FY), the government may get a complete new law in Bangla for the first time.
Tax would be imposed on the interest amount disbursed by the Mobile Financial Services (MFS) providers and also interest amount of loan taken from any citizen of Bangladesh, except bank, sources said.
The measures have been incorporated to help the government collect tax from a large volume of informal economy and MFSs, officials said.
Firm, Association of person, fund having turnover more than Tk 20 million will have to submit audited financial statements under the new law.
In case of detection of any undisclosed income on the sixth year, after expiring time of auditing a tax file for tax evasion, the taxmen would consider the income earned on the sixth year.
Under the new law, taxpayers will be able to close their tax registration number if he has no taxable income, leaves the country or passes away.
In the new law, the ceiling of investment rebate on monthly savings schemes would be increased to Tk 120,000 from existing Tk 60,000.
The taxmen would consider income derived from microcredit services as tax-free if it is a ‘revolving fund’ and spend on any asset for the services, not as capital for other businesses.
Except life insurance, premium income of other insurances, up to 10 per cent, is currently considered ‘allowable expenses’. It would be scrapped as a financial statement as per International Financial Reporting Standards (IFRS) has a provision to allow actual expenditure.
Submission of tax return under universal self assessment method has been made mandatory for all taxpayers.
For expatriate Bangladeshis, tax-day has to be calculated from the day of his return to up to 90 days.
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