Tax-free income ceiling rises
Minimum tax Tk 2000 for any service-receiving TIN
FE REPORT | Friday, 2 June 2023
Individual income taxpayers’ tax-free threshold rises while the budget for fiscal year (FY) 2023-24 proposes Tk 2,000 as minimum tax for anyone submitting return on service-receiving TIN.
The minimum income tax is obligatory for receiving specified government services no matter whether the tax-identification number (TIN)-holder has taxable income or not.
The limit to tax-free incomes would go up for all types of taxpayers— women, senior citizens, physically challenged, the third gender, war-wounded freedom fighters—from July 01 when the budget takes effect with commencement of the next fiscal year.
As proposed in the national budget for fiscal year 2023-24, placed Thursday in the parliament, the ceiling of tax-free income for individual taxpayers rises to Tk 350,000, up by Tk 50,000 in consideration of surging cost of living amid inexorable inflation.
The tax-free income had been unchanged for the three consecutive fiscal years until now. In FY 2020-21, the government raised the income-tax ceiling to Tk 0.3 million from Tk 250,000 after five years.
Female and taxpayers above 65 years of age would enjoy a higher ceiling at Tk 400,000, up from the uniform level of Tk 300,000.
Minimum tax rates for individuals remained unchanged at 5.0 per cent and maximum 25 per cent.
Tax-free limit for physically challenged persons would be Tk 475,000 from the exiting Tk 450,000, while war-wounded gazetted freedom fighter Tk 500,000 from Tk 475,000, third-gender taxpayers Tk 475,000 from Tk 350,000.
The threshold would be increased for parents or legal guardians of physically challenged children or dependants by Tk 50,000 for each child and dependant.
However, minimum tax for people having taxable income remained unchanged at Tk 5,000 for Dhaka and Chittagong City Corporations and Tk 4000 for any other city corporation, Tk 3000 for other areas.
For the upcoming FY, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) proposed to revise the ceiling to Tk 0.4 million while Dhaka Chamber of Commerce and Industry (DCCI) proposed to increase it to Tk 0.5 million.
doulotakter11@gmail.com