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As part of the national budget for fiscal year 2025–26 that the Government of Bangladesh is planning, several tax reforms are being considered to support small savers and increase the transparency of the tax system. One of the main suggestions made is to raise the amount of money you can deposit in a bank without incurring taxes from Taka 1 lakh to Taka 3 lakh. It also plans to edit existing rules for high net worth tax categories, lower current advance income tax on internet services and raise the cap on tax-free income. They aim to achieve fair taxation and support a broader economic participation of people.
Excise Duty Relief for Small Depositors
Beginning in the next financial year, the limit above which banks must pay excise duty on interest will be raised to Taka 3 lakh, helping out many small depositors. The duty for deposits above Taka 1 lakh is Taka 150. It is hoped that the change in the threshold which comes into effect July 1, 2024, will make things more convenient for low and middle-income savers. For higher deposit amounts, the duty slabs are not being modified. Banks will still need to collect Taka 500 for each deposit between Taka 5 lakh and Taka 10 lakh and this increases to Taka 50,000 for sums larger than Taka 5 crore.
People with a cash balance or assets greater than Taka 4 crore now pay a surcharge set at 10%-35% by the government, sometimes based on inflated values. According to the idea being discussed, the surcharge rates should be set as a percentage of one’s actual tax liability, not based on the amount of assets. The goal is to ensure fairness by cutting down on unfair taxes on people getting assessed on high property values.
Other Notable Tax Adjustments
To encourage more economic opportunities and bring down costs for internet services, the tax on these services from the advance income tax (AIT) is likely to be reduced from its current 10% to 5%. Also, the tax-free income bracket will go from Taka 450,000 to Taka 500,000, bringing additional help to those earning a low income.
Official changes are set to be announced by Finance Adviser Salehuddin Ahmed at 4 PM in a televised presentation on June 2. Authorities say the reforms place a strong emphasis on making tax policy equitable while helping the economy develop.
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