Tk375,000 now tax-free
The government has raised the tax-free income threshold for individual taxpayers to Tk375,000 from the existing Tk350,000, offering relief to salaried and middle-income earners.
Finance Minister Amir Khasru Mahmud Chowdhury announced
the revised threshold while presenting the national budget in Parliament on Thursday.
He also confirmed that the tax-free income limit will remain unchanged at Tk375,000 in the 2027–28 fiscal year.
Economists and tax analysts believe the measure will help ease the financial burden on lower- and middle-income households amid rising living costs.
As in previous years, certain categories of taxpayers will continue to enjoy higher tax-free income thresholds.
Female taxpayers and senior citizens aged 65 and above will be eligible for a tax-free income limit of Tk425,000.
Meanwhile, third-gender taxpayers and persons with disabilities will benefit from a higher exemption ceiling of Tk500,000. Gazetted freedom fighters and gazetted July fighters injured during the July 2024 mass uprising will enjoy a tax-free income threshold of Tk525,000.
In addition, parents or legal guardians of persons with disabilities will receive an extra Tk50,000 tax exemption for each disabled child or dependent beyond the applicable threshold.
According to official data, Bangladesh currently has around 12.8 million Taxpayer Identification Number (TIN) holders. Of these, approximately 4 to 4.2 million individuals submit income tax returns each year.
These taxpayers are required to calculate their taxable income based on the applicable exemption threshold before paying tax.
The budget also introduces significant changes to the income tax structure. The previous 5 per cent tax slab applicable to the first Tk100,000 of income above the tax-free threshold has been abolished.
Under the revised system, income exceeding Tk375,000 will be taxed at 10 per cent on the first Tk300,000, 15 per cent on the next Tk400,000, 20 per cent on the following Tk500,000, 25 per cent on the next Tk200,000, and 30 per cent on any remaining income above those levels.
While the higher tax-free threshold is expected to benefit many taxpayers, the restructuring of tax slabs could result in a modest increase in tax liabilities for some higher-income earners.
