This August 2024 Tax News Flash summarises the NBR orders on incentives for investors and developers in Economic Zones (EZs) set up under the Bangladesh Economic Zones Authority (BEZA), which also provides one-stop services to zone investors.

Income tax: investors whose manufacturing or service operations start commercial operation by 30 June 2035 receive a 10-year reducing exemption, subject to conditions: 100% for the first three years, then 80%, 70%, 60%, 50%, 40%, 30% and 20% for years four to ten. Developers are exempt at 100% for the first ten years, 70% in the 11th year and 30% in the 12th year.

VAT and customs: EZ companies receive VAT exemptions on natural gas, WASA, procurement provider services (excluding petroleum products) and electricity. Industrial companies are exempt from customs duty, regulatory duty, supplementary duty and VAT on imported capital machinery, equipment and parts. Developers receive the same exemption on goods imported for zone development, except construction materials readily available in Bangladesh, such as MS rod, cement and steel sheet, and items not directly related to development, such as office equipment, air conditioners and passenger vehicles. Industrial units in EZs also receive a customs duty exemption on imported vehicles, subject to conditions.