This newsletter summarises income tax and VAT changes in Bangladesh announced up to December 2024, following amendments to the Income Tax Act 2023 (ITA 2023) and related orders.

Income tax: the option to report undisclosed income held in securities, cash and similar assets by paying 15% tax has been revoked. Donations to the Center for Zakat Management now qualify for investment rebate until 30 June 2029. NBR made online return filing mandatory for government employees in the Dhaka, Gazipur and Narayanganj city corporations, employees of scheduled banks and mobile operators, and staff of several named multinationals. From 1 July 2025, taxpayers other than companies, funds and trusts pay 15% on gains from listed securities regardless of holding period. Renewable energy producers starting commercial operation between 1 July 2025 and 30 June 2030 receive a 15-year exemption: 100% for ten years, 50% for three and 25% for two. Grameen Bank income is exempt until 31 December 2029, the ICB Unit Fund is exempt subject to conditions, and the exemption for foreign remittance earned by Bangladeshi flag ocean-going ships is withdrawn.

VAT and customs: the update covers new procedures for sub-contracted exports, advance tax exemption for solar panel and certain film manufacturers, VAT exemption on inter-bonded transfers of capital machinery, 7.5% VAT on imported ocean-going ships, and VAT and advance tax exemptions on machinery for green ship recycling yards.