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Rebate process for individual’s investment may be eased

Black money holders to get a fresh chance


Doulot Akter Mala | Published: June 11, 2019 09:37:32 | Updated: June 12, 2019 14:06:47


Investment rebate for individual taxpayers might be brought down to two stages with modifications in the forthcoming budget to ease the facility for salaried persons, officials said.

There might be 12 per cent and 15 per cent rates for the individual taxpayers, instead of existing 10, 12 and 15 -- upon investment in certain areas, they said.

Under the existing income tax ordinance, a taxpayer can enjoy tax rebate at a rate of 15 per cent if the eligible amount of investment remains below Tk 1.0 million.

The rebate is given at three slabs --10 per cent, 12 per cent and 15 per cent-if eligible investment amount is higher than Tk 1.0 million.

Now, people having eligible investment amount of more than Tk 1.0 million may get 12 per cent rebate.

A taxpayer can claim the rebate on investment of up to 25 per cent of his or her total income or Tk 15 million, or the actual investment, whichever is lower.

A fresh black money whitening scheme to attract investment, extension of tax holiday facilities for industrial sectors until 2024, reduction of area-wise real estate tax rates, and upward adjustment of tax-free ceiling for dividend income are among the major income tax measures that are likely to be proposed in the budget.

However, the National Board of Revenue order may keep the existing tax-free threshold for individual taxpayers and corporate tax rates unchanged in the budget for fiscal year 2019-20.

In the budget, the finance minister could offer blanket opportunity to disclose undeclared income by paying 10 per cent tax at a flat rate with some conditions being attached.

But people having undisclosed money will have to invest their money in the industrial sector.

Currently, there is a provision in the income tax ordinance for voluntary disclosure of undisclosed income by paying 10 per cent penal tax in addition to the payable income tax.

In response to the demands from the manufacturing sector, the government might extend the existing tax holiday facility for another five years.

The existing tax holiday facility for many industrial sectors is scheduled to expire in June 2019.

In the budget, there would be effective measures to ensure tax return submission by the Taxpayers Identification Number (TIN) holders.

Currently, some 1.7 million taxpayers file tax returns out of 4.0 million TIN holders.

Source tax rate might be reinstated at 1.0 per cent for exporters as the tenure for reduced rate of 0.25 per cent will expire on June 30, 2019.

Currently, tax-free threshold for individual taxpayers is Tk 250,000.

Officials familiar with the development said that the tax-free ceiling might remain unchanged in the budget despite demands from wider section of people to increase the limit.

On customs measure, import duty on sugar might be revised upward in the upcoming fiscal year.

doulot_akter@yahoo.com

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