New taxation measure for new industries to replace tax holiday
Friday, 12 June 2009
FE Report
The government has proposed to replace the tax holiday facility for new industries by a new taxation measure titled 'reduced rate' from fiscal 2009-10.
The existing industries are entitled for tax holiday until 2012. The Finance minister AMA Muhith in his budget speech Thursday has proposed not to extend the facilities further.
"Tax holiday acts as an impediment to the taxpaying culture," Finance minister said.
He said: " …..it would be more appropriate to replace the existing tax holidays with provisions for payment of taxes but at a reduced rate to create an enabling environment for industrialisation, investment and job creation in the country."
Finance minister has proposed to offer reduced tax rate for a number of sectors. The rates would be variable for newly established industries depending on the location.
For industries located in Dhaka and Chittagong divisions (barring Rangamati, Bandorbon and Khagrachori districts) reduced tax of 5.0 per cent will be applicable for the first two years 10 per cent for the subsequent two years and 15 per cent for the fifth year.
In Rajshahi, Khulna, Sylhet, Barisal divisions and Rangamati, Bandarbon and Kharachori districts of Chittagong division, 5.0 per cent reduced tax will be applicable for first three years, 10 per cent for the subsequent three years and 15 per cent for the seventh year.
The government has proposed to replace the tax holiday facility for new industries by a new taxation measure titled 'reduced rate' from fiscal 2009-10.
The existing industries are entitled for tax holiday until 2012. The Finance minister AMA Muhith in his budget speech Thursday has proposed not to extend the facilities further.
"Tax holiday acts as an impediment to the taxpaying culture," Finance minister said.
He said: " …..it would be more appropriate to replace the existing tax holidays with provisions for payment of taxes but at a reduced rate to create an enabling environment for industrialisation, investment and job creation in the country."
Finance minister has proposed to offer reduced tax rate for a number of sectors. The rates would be variable for newly established industries depending on the location.
For industries located in Dhaka and Chittagong divisions (barring Rangamati, Bandorbon and Khagrachori districts) reduced tax of 5.0 per cent will be applicable for the first two years 10 per cent for the subsequent two years and 15 per cent for the fifth year.
In Rajshahi, Khulna, Sylhet, Barisal divisions and Rangamati, Bandarbon and Kharachori districts of Chittagong division, 5.0 per cent reduced tax will be applicable for first three years, 10 per cent for the subsequent three years and 15 per cent for the seventh year.