Taxation System

To prevent double taxation and promote cross-border trade, Bangladesh has 36 Double Taxation Agreements (DTAs)with countries such as India, the United States, the United Kingdom, Japan, and China. These treaties help avoid double taxation on income, dividends, royalties, and capital gains while providing reduced withholding tax rates for foreign investors. Foreign companies operating in Bangladesh must consider branch remittance tax (20%) if repatriating […]

Zakat, an Islamic charitable levy, is applicable to Muslims with eligible wealth. The government administers mandatory Zakat collection on certain assets, including bank deposits and shares. Other levies include stamp duties, property taxes, and excise duties on specific goods like tobacco and alcohol. To support economic growth, the government periodically introduces sectoral tax reliefs and incentives for industries such as manufacturing, export-oriented businesses, and IT.

The Value-Added Tax and Supplementary Duty Act 2012 mandates a 15% standard VAT rate on most goods and services, with some zero-rated or exempt categories. Specific sectors, such as telecommunications and luxury goods, face supplementary duties in addition to VAT. Import duties range from 3% to 5% based on the type of importer. VAT filings must be submitted monthly by the 15th of the following month. The

Bangladesh imposes withholding taxes on various payments, including dividends, interest, royalties, and technical service fees. Rates range from 10% to 20% for residents and 20% to 30% for non-residents, with possible reductions under Double Taxation Agreements (DTAs). Capital gains tax depends on the nature of the asset and holding period. Gains from the sale of listed securities are taxed at 10% for individuals and 15%

Corporate tax rates in Bangladesh differ based on business type and listing status. Listed companies generally face a 22.5% corporate tax, whereas unlisted ones pay 30%. Higher rates apply to specific sectors: banks, insurance companies, and financial institutions pay 37.5% (listed) or 40% (unlisted), while telecom operators pay up to 45%. Non-resident companies are taxed at 30% on Bangladesh-sourced income. A minimum tax

Bangladesh operates a dual taxation system comprising direct and indirect taxes. The Income Tax Act, 2023, and Income Tax Rules, 1984 govern direct taxation, which includes corporate and individual income taxes. Indirect taxes, primarily Value-Added Tax (VAT) and customs duties, are levied on the supply of goods and services. The National Board of Revenue (NBR) is the key regulatory body overseeing tax administration. Bangladesh has