The tax landscape in Bangladesh is undergoing significant changes. The introduction of the new minimum tax requirement marks the end of the ‘zero return’ era for many taxpayers.
For years, taxpayers with no taxable income were required to file a zero-income tax return, indicating no tax liability.
This particularly applied to individuals with a Tax Identification Number (TIN) whose income fell below the taxable threshold. The zero-return served as a compliance measure, ensuring that all potential taxpayers were accounted for in the system.
However, the Income Tax Act of 2023 has introduced a paradigm shift. Residents within the Dhaka and Chattogram city corporation areas are now subject to a minimum tax of Tk 5,000, for other city corporations, Tk 4000, and for residents outside of the city corporation, Tk 3000 if their taxable income exceeds the first slab of Tk 350,000 for males and Tk 400,000 for females.
This change came into effect in the fiscal year 2023-24. This move aims to broaden the tax base and ensure that all eligible taxpayers contribute to national revenue.
Thus, urban residents face a minimum tax liability, while rural taxpayers experience a lower minimum tax rate. Low-income earners benefit from an expanded zero percent tax slab, reducing their tax burden.
Sabik Abdullah
Student, Bangladesh University of Professionals
