Tax exemptions

In the Ordinance:

1. Tax holiday for newly set up specified industry - Section 46B.

2. Tax holiday for certain physical infrastructure – Section 46C.
3. Tax exemption of certain income of co-operative society – Section 47.

4. Sixth Schedule Part A read with section 44(1):

(1) Any income derived from house property held under trust or other legal obligation wholly for
religious or charitable purposes, and in the case of house property so held in part only for such
purposes, the income applied, or finally set apart for application, thereto.
Explanation.- The provisions of this paragraph shall not apply in the case of a non-government
organisation registered with NGO Affairs Bureau.
(2) Where any income is not applied or is not deemed to have been applied to charitable or
religious purposes in Bangladesh during the income year but is accumulated, or finally set apart,
for application to such purposes in Bangladesh, such income shall not be included in the total
income of the income year of the person in receipt of the income, provided the following
conditions are complied with, namely,-
(a) such person specifies, by notice in writing given to the Deputy Commissioner of Taxes, the
purpose for which the income is being accumulated or set apart, and the period for which
the income is to be accumulated or set apart, which shall in no case exceed ten years;
(b) the money so accumulated or set apart is-
(i) invested in any Government security as defined in section 2(2) of Public Debt Act, 1944
(XVIII of 1944), or in any other security which may be approved by the Government in
this behalf, or
(ii) deposited in any account with the Post Office Savings Bank[,or]Subs. F.A. 2011
(iii) deposited in any account with scheduled bank of which fifty one per cent or more shares
are held by the government.]Added F.A. 2011
(3) Where any income which-
(a) is applied to purposes other than charitable or religious purposes or ceases to be
ccumulated or set apart for application thereto, or
(b) ceases to remain invested in any security or deposited in any account referred to in sub-
paragraph (2), or
(c) is not utilised for the purpose for which it is so accumulated or set apart during the period
referred to in sub-paragraph (2) or in the year immediately following the expiry thereof,
shall be deemed to be the income of such person of the income year in which it is so applied
or ceases to be so accumulated or set apart or ceases to remain so invested or deposited or,
as the case may be, of the income year immediately following the expiry of the period
aforesaid.
1A. Any service charge derived from operation of micro credit by a non-government
organisation registered with NGO Affairs Bureau.
Explanation.– For the purpose of this paragraph, “service charge” means any financial charge
or interest or share of profit, called by whatever name, paid or payable by the loan recipient
for the amount borrowed under micro credit programme from the nongovernment
organisation.
2. Any voluntary contributions received by a religious or charitable institution and applicable
solely to religious or charitable purposes:
Provided that nothing contained in paragraph 1 or 2 shall operate to exempt from the
provisions of this Ordinance that part of the total income of a private religious trust which does
not ensure for the benefit of the public.
3. The income of a local government.
4. (1) Any income accruing to, or derived by, a provident fund to which the Provident Fund Act,
1925 (XIX of 1925), applies.
(2) Any income accruing to, or derived by, workers participation fund established under the
Bangladesh Labour Act, 2006 (Act No. XLII of 2006) subject to any such conditions and limits
as may be prescribed.
5. Any special allowance, benefits or perquisite specifically granted to meet expenses wholly
and necessarily incurred in the performance of the duties of an office or employment of profit.
6. Any income received by the trustees on behalf of a recognised provident fund, an approved
superannuation fund or pension fund and an approved gratuity fund.
7. Any income received-
(a) by any ambassador, high commissioner, envoy, minister, charge d’affairs, commissioner,
counsellor, consul de carriere, secretary, adviser or attache of an embassy, high
commission, legation or commission of a foreign State, as remuneration from such State for
service in such capacity;
(b) by a trade commissioner or other official representative in Bangladesh of a foreign State
(not holding office as such in an honorary capacity) as his official salary, if the official salary
of the corresponding officials, if any, of the Government, resident for similar purposes in the
country concerned, enjoy a similar exemption in that country;
(c) by a member of the staff of any of the officials referred to in clauses (a) and (b), as his official
salary, when such member is not a citizen of Bangladesh and is either a subject of the country
represented or a subject of some other foreign State and is not engaged in any business or
profession or employment in Bangladesh otherwise than as a member of such staff, and the
country represented has made corresponding provisions for similar exemptions in the case of
members of the staff of the corresponding officials of the Government of the People’s Republic
of Bangladesh in that country.
8. Any pension due to, or received by, an assessee.
11A. Income from dividend received from a company listed in any stock exchange in Bangladesh up
to twenty five thousand taka.
18. Any income received by an assessee in respect of any share of income out of the capital gains on
which tax has been paid by the firm of which the assessee is a partner.] Added F. A. 2015 19.[Any sum
received by an assessee as a member of a Hindu undivided family where such sum has been paid out
of the income of the family.
20. Any income up to taka two crore fifty lakh received by an assessee as gratuity.
21. Any payment form-
 (a) a provident fund to which the provident Funds Act,1925 (X1X of 1925),applies; or
 (b) a recognised provident fund, subject to any such conditions and limits as my be prescribed; or
 (c) an approved superannuation fund, subject to any such conditions and limits as many be
prescribed ;or
 (d) a workers participation fund established under evsjv‡`k kªg AvBb, 2006 to any person not
exceeding fifty thousand taka, notwithstanding anything contained in any other law for the time
being in force regarding tax exemption of such payment;
22A. Income from a mutual fund or a unit fund up to taka twenty five thousand.;
24. Any interest classifiable under the head “Interest on securities” receivable by an assessee on any
security of the Government, which is issued with the condition that interest thereon shall not be
liable to tax.
24A. Any income received by an assessee from Wage earners development bond, US dollar premium
bond, US dollar investment bond, Euro premium bond, Euro investment bond, Pound sterling
investment bond or Pound sterling premium bond.
25. Any sum representing interest credited on the accumulated balance of an employee in a recognised
provident fund, in so far as it does not exceed one-third of the salary of the employee for the year
concerned and in so far as it is allowed at a rate not exceeding such rate as the Board may, by
notification in the official Gazette, fix in this behalf.

26. Any amount received by an employee of a Government organisation, a local authority, or an

 autonomous or semi-autonomous body including the units or enterprises controlled by it, at the
time of his voluntary retirement in accordance with any scheme approved by the Government in
this behalf.
27. Notwithstanding anything contained in any order or regulation for the time being in force, any
income of an individual, being an indigenous hillman of any of the hill districts of Rangamati,
Bandarban and Khagrachari, which has been derived solely from economic activities undertaken
within the said hill districts.
28. An amount equal to fifty per cent. of the income of an assessee, other than a company not registered
in Bangladesh, derived from the business of export but it shall not apply in case of an assessee, who is
enjoying exemption of tax or reduction in rate of tax by any notification made under this Ordinance
Explanation.– For the purpose of this paragraph,–
(a) sale of locally manufactured machinery, equipment and other finished products within the
country to any agency against its procurement program in foreign exchange quota; and
(b) supply of locally manufactured raw materials and other inputs to export oriented industry under
internal back-to-back letter of credit, shall also be included in the definition of “business of
export.”
29. Any income, not exceeding two lakh taka, chargeable under the head “Agricultural income” of an
assessee, being an individual, whose only source of income is agriculture.
31B. Any income not exceeding twenty five thousand taka received from interest on savings
instruments;
Provided that the exemption under this paragraph will not be applicable where tax is deductible
under section 52D.
32A. Any sum or aggregate of sums received as interest from pensioners’ savings certificate where the
total accumulated investment at the end of the relevant income year in such certificate does not
exceed taka five lakh
33. Any income derived from the following business of a person being a resident or a
non-resident Bangladeshi for the period from the first day of July, 2008 to the thirtieth
day of June, 2024 on the conditions that the person shall file income tax return in
accordance with the provisions of section 75-

(i) Software development;

(ii)Software or application customization;
(iii) Nationwide Telecommunication Transmission Network (NTTN);
(iv) Digital content development and management
(v) Digital animation development;
(vi) Website development;
(vii) Web site services;
(viii) Web listing
(ix) IT process outsourcing;
(x) Website hosting;
(xi) Digital graphics design;
(xii) Digital data entry and processing;
(xiii) Digital data analytics;
(xiv) Geographic Information Services (GIS);
(xv) IT support and software maintenance service;
(xvi) Software test lab services;
(xvii) Call center service;
(xviii) Overseas medical transcription;
(xix) Search engine optimization services;
(xx) Document conversion, imaging and digital archiving;
(xxi) Robotics process outsourcing;
(xxii) Cyber security services.”;
34. Subject to the conditions made here under any income from fisheries, poultry, production of
production of seeds, marketing of locally produced seeds, cattle farming, dairy farming.
Horticulture, frog faming, mushroom farming, floriculture, sericulture for the period from the first
day of July, 2008 to the thirtieth day of June, 2013
(a) if such income exceeds taka one lakh and fifty thousand, the person shall invest an amount not
less than ten percent of the said income in the purchase of bond or securities issued by the
Government within six months from the end of the income year and hold such bond or securities
till maturity of such bond or securities;
(b) the person shall file return in accordance with the provisions of section 75(2)(c) of the
Ordinance; and
(c) no such income shall be transferred within five years from the end of the income year: ]
Provided that income from fisheries as mentioned in this paragraph shall not apply to a company
as defined in clause (20) of section (2) of this Ordinance.
35. Any income derived from the export of handicrafts for the period from the first day of July, 2008
to the thirtieth day of June, 2019.
36. Any amount paid by the Government as tax on behalf of a petroleum exploration company
engaged in exploration of petroleum products in Bangladesh under Production Sharing Contract
(PSC) with the Government of Bangladesh.
37. Income of any private Agricultural College or private Agricultural University derived from
agricultural educational activities.
38. Any income derived from any building, not less than five storied having at least ten flats,
constructed at any time between the first day of July, 2008 and the thirtieth day of June, 2013
(both days inclusive), for ten years from the date of completion of construction of the building:
Provided that the building shall be situated in any area of Bangladesh other than the areas of City
Corporation, headquarters and any pourashava under Dhaka district.
39. Income derived from any Small and Medium Enterprise (SME) engaged in production of any
goods and having an annual turnover of not more than taka thirty six lakh:
Provided that person shall file income tax return in accordance with the provisions of section 75 of
the Ordinance.
40. Any income derived from Zero Coupon Bond received by a person other than Bank, Insurance or
any Financial Institution, subject to the following conditions:
(a) that the Zero Coupon Bond is issued by Bank, Insurance or any Financial Institution with
prior approval or Bangladesh Bank and Securities Exchange Commission.
(b) that the Zero Coupon Bond is issued by institution other than Bank, Insurance or any
Financial Institution with prior approval of Securities Exchange Commission.
43. Any profits and gains under the head “capital gains” arising from the transfer of stocks or shares
of a public company as defined in Companies Act,1994 listed in any stock exchange of Bangladesh
of an assessee being a non-resident subject to the condition that such assesse is entitled to similar
exemption in the country in which he is a resident.

44. An amount of income derived from cinema hall or Cineplex which starts commercial
exhibition between the first day of July, 2012 and thirtieth day of June, 2019 for the period,
and at the rate specified below:
if it is set-up in-

(i) Dhaka,Mymensingh or Chittagong divisions (excluding city corporation area and

Rangamati, Bandarban and Khagrachari districts) for a period of five years beginning with
the month of commencement of commercial production:
45. An amount of income derived by an industrial undertaking engaged in the production of rice
bran oil and commencing commercial production between the first day of July, 2012 and
thirtieth day of June, 2019 for the period, and at the rate specified below:
if the said undertaking is set-up in-

(i) Dhaka, Mymensingh or Chittagong divisions (excluding city corporation area and Rangamati,
Bandarban and Khagrachari districts) for a period of five years beginning with the month of
commencement of commercial production :

(ii) Rajshiahi, Khulna, Sylhet, Rangpur and Barisal divisions (excluding city
corporation area) and Rangamati, Bandarban and Khagrachari districts for a period
of ten years beginning with the month of commencement of commercial exhibition:

Period of Exemption Rate of Exemption

For the first three years (first, second and third 100% of income
year)
For the next three years (fourth, fifth and sixth 50% of income
year)
For the next four years (seventh to tenth year) 25% of income
(iii) Rajshahi, Khulna, Sylhet, Rangpur and Barisal divisions (excluding city corporation area) and
Rangamati, Bandarban and Khagrachari districts for a period of ten years beginning with the
month of commencement of commercial exhibition
46. An amount equal to fifty percent of the income of an assessee derived from the production
of corn/maize or sugar beet;

47. Income of an assessee donated in an income year to any fund established by or under the
provisions of Trust of Prime Minister’s Education Assistance Act, 2012 ( Act No. 15 of 2012)
subject to a maximum of-

(a) twenty percent (20%) of income of a company or taka eight crore, whichever is less;

(b) twenty percent (20%) of income of an assessee other than a company or one
crore taka , whichever is less.

48. Any income earned in abroad by an individual assessee being a Bangladeshi citizen and
brought any such income into Bangladesh as per existing laws applicable in respect of foreign
remittance.

49. Income of an assessee donated in an income year by a crossed cheque or bank transfer to
any girls’ school or girls’ college approved by the Ministry of Education of the government.

50. Income of an assessee donated in an income year by a crossed cheque or bank transfer to
any Technical and Vocational Training Institute approved by the Ministry of Education of the
government.

51. Income of an assessee donated in an income year by a crossed cheque or bank transfer to
any national level institution engaged in the Research & Development (R&D) of agriculture,
science, techonology and industrial development.

52. Any income, not being interest or dividend classifiable under the head “Income
from other sources”, received by any educational institution, if it –

(i) is enlisted for Monthly Pay Order (MPO) of the Government;

(ii) follows the curriculum approved by the Government;

(iii) is governed by a body formed as per Government rules or regulations.

53. Any income, not being interest or dividend classifiable under the head “Income from other
sources”, received by any public university or any professional institute established under any
law and run by professional body of Chartered Accountants or Cost and Management
Accountants or Chartered Secretaries.
Exemptions by SROs:
1. Power generation : (a) Coal fired power generation company – SRO No 213-
ain/aikor/2013 dated 01/07/2013.
(b) Other than coal fired power generation company- SRO No 212-ain/aikor/2013
dated 01/07/2013.
(c) Other than coal fired power generation company- SRO No 211-ain/aikor/2013
dated 01/07/2013 .Time extended up to 31/12/2019 by SRO 354 dated 18/11/2013 &
246 dated 26/06/2016.
(d) Renewable energy for 5 years – SRO 212-ain/2009 dated 01/09/2009.
2. Govt salary: Salary income other than basic salary & bonus of employees of govt,
semi-govt, autonomous nationalized enterprises - SRO No 211-ain/aikor/2017 dated
21/06/2017.
3. PPP:(a) capital gain from transfer of share, royalty , technical know how, technical
assistance fee of PPP company- - SRO No 209-ain/aikor/2017 dated 21/06/2017.
(b) 50% salary income of expatriate employees of PPP - SRO No 210-ain/aikor/2017
dated 21/06/2017.
(c) Business income of PPP company for 10 years - SRO No 208-ain/aikor/2017 dated
21/06/2017.
04.Paultry etc:
(a) Reduced tax rate for income from:
Production of pelleted poultry feed, diary farming, shrimp, fish;
Production of seeds;
Marketing of locally produced seeds;
Diary farm;
Frog farm;
Horticulture;
Sericulture;
Bee farming;
Mushroom farming;
Floriculture.
SRO No 199-ain/aikor/2015 dated 30/06/2015.
(b) Income from poultry & duckery – SRO No 254-Ain/aikor/2016 dated16/08/2015.
(c) Income from poultry, duckery, fish/shrimp hatchery, fish farming – SRO No 255-
Ain/aikor/2015 dated 16/08/2015.

05. EPZ: Business income of industries set up in EPZ - SRO No 219-ain/aikor/2012 dated
27/06/2012.
06. FBCCI/trade bodies: Income other than business & interest of trade federation &
associations approved by Ministry of Commerce - SRO No 210-ain/aikor/2013 dated
01/07/2013.
07. Special Economic Zone:
(a) 10 years holiday for business income of industries set up in SEZ - SRO No 226-
Ain/aikor/2015 dated 02/07/2015.
(b) 12 years holiday for business income of developers of SEZ - SRO No 227-Ain/aikor/2015
dated 02/07/2015
08. Hi- tech park:
(a) 10 years holiday for business income of industries set up in High tech park - SRO No 228-
Ain/aikor/2015 dated 02/07/2015.
(b) 12 years holiday for business income of developers of High tech park - SRO No 229
-Ain/aikor/2015 dated 02/07/2015.
09.Share transaction: Income of individuals from transfer of shares of listed companies - SRO
No 196 -Ain/aikor/2015 dated 30/06/2015.
10. Stock exchange: 5 years tax holiday on income of demutualized stock exchange - SRO No
157 -Ain/aikor/2014 dated 26/06/2014.
11 Income political parties registered by Election Commission – SRO 330-Ain/Aikor/2011 dated
26/10/2011.
12. Income of national level sports organization – SRO 47-l/85 dated 16/01/1985.
13. Monetary reward received by government employees – SRO 245-ain/2001 dated 29/08/2001.

Concessionary tax rate:

(1) Capital gain of a company from transfer of securities of listed companies shall be taxed
at the rate of 10% as per SRO No. 196-Ain/aikor/2015 dated 30 June 2015.

(2) Industrial company commencing its business activities between 01 July 2014 and 30
June 2019 shall get rebate of 20%, complying with conditions mentioned in the SRO, on
tax payable for a period of 10 (ten) years through SRO No. 185-Ain/aikor/2014 dated 01
July 2014.

(3) Export:

(a) Company engaged in manufacturing jute goods shall pay tax on income from export of
jute goods @ 10% up to the assessment year 2019-2020.-SRO No. 205-Ain/aikor/2016
dated 29 June 2016.

(b) Company engaged in manufacturing yarn, dying, finishing, Coning yarn, manufacturing
clothes, dying, finishing, printing clothes or process of the same associated with
manufacturing of clothes shall pay tax @ 15% on the income form the said business for
the period from 01 July 2015 to 30 June 2019.-SRO No. 193-Ain/aikor/2015.