Income Tax Authorities: The National Board of Revenue (NBR) is the central authority for tax administration in Bangladesh. It was established by President’s Order No. 76 of 1972. Administratively, it is under the Internal Resources Division (IRD) of the Ministry of Finance (MoF). MoF has 4 Divisions, headed by 4 permanent Secretaries to the Government, namely, the Finance Division the Internal Resources Division (IRD), the Banking Division and the Economic Relations Division (ERD). The Secretary, IRD is the ex-officio Chairman of NBR.
In Bangladesh, filing returns manually is a long process which involves filling up many pages of tax return forms. The process is very difficult and time consuming. There is potential risk of error because of this manual processing of returns. To ensure the public benefit regarding online return submission, National Board of Revenue (NBR), Bangladesh took initiatives of online return submission. The system is simple, smart and easy to use and also help to taxpayers to prepare an accurate tax return without missing any tax benefit…
The basic concept of indenting business is in the role to connect buyers and sellers worldwide. The proposed indenting company is to be involved in a broad range of activities and should have very strong business presence, connections and dealings among countries, in serving both the domestic and international sectors with a strong vision for the future, professionally managed business entity. Researching targeted market is one of the most important key to success. Before starting indenting business,
When considering the registration of a new company or relocation of your existing company to Bangladesh, note that most Bangladeshi companies are registered as private limited liability companies (commonly known as private limited companies). A private limited company in Bangladesh is a separate legal entity and shareholders are not liable for the company’s debts beyond the amount of share capital they have contributed. According to the Companies Act 1994, any person (foreign or local) above the age of 18 can register a company in Bangladesh.
How to become an exporter from Bangladesh: Chief Controller of Imports & Exports Provides the Export Registration Certificate (ERC) to The potential Exporters. The City Corporation/Municipal Corporation/Union Parishad are responsible for issuing Trade Licence. Required documents for Export Registration: (i) Filled - in Application Form; (ii) Partnership deed/memorandum, article of association and incorporation certificates; (iii) Copy of the valid trade licence; (iv) Membership of the Chamber; (v) Treasury Chalan.
The Registrar of Joint Stock Companies and Firms (RJSCF) is the sole authority which facilitates formation of companies etc.; and keeps track of all ownership related issues as prescribed by the laws in Bangladesh. The Registrar is the authority of the Office of the Registrar of Joint Stock Companies and Firms, Bangladesh.
Bangladesh provides for tax incentives for foreign companies investing in special economic zones and hi-tech park zones (in the form of gradually decreasing tax discounts). Qualifying industrial undertaking set up between 1 July 2011 and 30 June 2019 are also entitled to gradual tax discounts, with rates varying from one region to another. Capital gains arising from the disposal of listed shares are subject to a 10% tax whereas those arising from the transfer of other types securities are taxed at 15%. Non-residents are exempt from tax on their capital gains arising from the disposal of listed shares if they enjoy a similar exemption in their country of origin (otherwise they are taxed at the standard rates).
Historically, the banking sector of Bangladesh has been amply participating in various social activities especially, in the areas of education, health, sports, benevolent activities like donations to different charitable organizations, to poor people and religious institutions, city beautification and patronizing art & culture, etc. Bangladesh Bank issued a comprehensive circular titled ‘Mainstreaming Corporate Social Responsibility (CSR) in banks and financial institutions in Bangladesh’.
Double Taxation is created when the same income is taxed in two different countres during international trade. Avoidance of Double Taxation Agreements is an agreement concluded between Bangladesh and another jurisdiction (a treaty partner) which serves to relieve double taxation of income that is earned in one jurisdiction by a resident of the other jurisdiction. It spells out the taxing rights between Bangladesh and her treaty partner on the different types of income arising from cross-border economic activities between the two jurisdictions. It also provides for reduction or exemption of tax on certain types of income.
The National Board of Revenue (NBR) is the central authority for tax administration in Bangladesh. It was established by President Order No. 76 of 1972. Administratively, it is under the Internal Resources Division (IRD) of the Ministry of Finance (MoF). MoF has 4 Divisions, headed by 4 permanent Secretaries to the Government, namely, the Finance Division the Internal Resources Division (IRD), the Banking Division and the Economic Relations Division (ERD). The Secretary, IRD is the ex-officio Chairman of NBR.
Industrialization is an essential prerequisite for rapid and sustained economic development and social progress. But it fetches environmental degradation like air, water and soil pollution. So, environmental management is necessary to decrease such environmental pollution and degradation. The Government of Bangladesh provides importance to protect environment and natural resources. It is mandatory to obtain Environmental Clearance for each and every type of industry and project as per Bangladesh Environment Conservation Act, 1995 (Amended 2010).
Foreign Capital means capital invested in Banladesh in any industrial undertaking by a citizen of any foreign country or by a company incorporated outside Bangladesh, in the form of foreign exchange, imported machinery and equipment and Foreign Private Investment means investment of foreign capital by a person who is not a citizen of Bangladesh or by a company incorporated outside Bangladesh, but does not include investment by a foreign Government or an agency of foreign Government. Foreign investment in Bangladesh is protected by the “Foreign Private Investment Promotion and Protection Act” and also supported by:
In Bangladesh, for a return submitted under normal scheme, assessment is made after giving an opportunity of hearing. For returns submitted under Universal Self Assessment Scheme, the acknowledgement slip is considered to be an assessment order of the Deputy Commissioner of Taxes. Universal Self Assessment may be subject to “process and audit”. Provided that a return of income filed under universal self assessment scheme, shall not be selected for audit where such return shows at least twenty per cent higher income than the income assessed or shown in the return of the immediately preceding assessment year and such return-
Before buying any property in Bangladesh, it is necessary to check the ownership of the property. In Bangladesh, dispute with property ownership is very common. Documents related to property are easily forged and unreliable. If any person, while buying a property, is not cautious, might face problems, possibly litigation with the ownership of the property at a later stage. However, checking ownership of property in Bangladesh is a laborious job. To check the ownership of a property, a buyer should do the following:
An entrepreneur has to follow nine specific procedures and legal steps to set up a business in Bangladesh. At the outset, the entrepreneur has to apply to Registrar of Joint Stock Companies and Firms (RJSC) for Name Clearance Certificate. After receiving the certificate, the next step is to pay stamp duty at a Designated Bank and again apply to RJSC for registration. Then the company makes seal and open a bank account and then apply for trade license to respective City Corporation or Municipal Corporations. After completing all those procedures, the entrepreneur has to approach to the National Board of Revenue (NBR) for receiving TIN Certificate and registering with the Customs, Excise, and VAT Commissionerate. Finally, the investor requires to apply to theBangladesh Investment Development Authority (BIDA) for registration.
There have been some policy discussions about the tax law in Bangladesh, although not very effective. The income tax legislation dates to the Income Tax Ordinance 1984, and was promulgated under the military rule. According to the 1984 Ordinance there are seven forms of income on which tax is levied: salaries, interest on securities, income from house or property, agricultural income, income from business or profession, capital gains and income from other sources (Income Tax Manual Part-1, 2019). A number of efforts were made to strengthen the revenue mobilization and improve the tax structure.
The current fiscal regime of Bangladesh consists of direct and indirect taxation. It is governed by the National Board of Revenue (NBR). Revenue is also generated from non-NBR sectors and under the laws and acts of related ministries. The NBR taxes include Customs Duty, Value Added Tax (VAT), Supplementary Duty (SD), Personal Income Taxes (PIT) and Corporate Income Taxes (CIT). Personal and Corporate Income Tax, the single largest source of direct tax, is governed by the Income Tax Ordinance, 1984 (XXXVI of 1984). The income tax laws consist of the following statutes (apart from the main statute):
The major reform of tax administration occurred in the 1990s, in a democratic regime following military rule in the country. However, there is no study to measure the effect of democratic environment on the revenue administration and governance. Indirect taxes are still the primary source of government income and contribute the lion’s share of total tax receipts in Bangladesh. The administration of direct taxes is outdated and based on territorial and geographical administrative units.
Bangladesh is a common law based jurisdiction. Many of the basic laws of Bangladesh such as penal code, civil and criminal procedural codes, contract law and company law are influenced by English common laws.
According to historic records, Income Tax was introduced to the Indian sub continent public in 1860. After a couple of years, it got abolished because people were not satisfied that they had to pay some amount of their incomes. But afterwards, it was reinforced again as the government noticed its importance in terms of the total revenue of the country. James Wilson, the Scotsman who created first Budget in India, introduced the income tax act in 1860. This created a big controversy. Wilson argued since the British provided safe and secure environment to Indians to carry on trade they were justified in charging a fee in the form of an income tax.