Tax-free income ceiling remains unchanged in proposed budget

The ceiling of tax-free income remains unchanged in the proposed budget, presented by prime minister Sheikh Hasina instead of ailing finance minister AHM Mustafa Kamal in parliament, for 2019-20 fiscal.

The income ceiling is Tk 250,000 for male taxpayers and Tk 300,000 for females.

In the budget speech the minister said, “The criteria for keeping the threshold unchanged for the last few years have remained same this year. In developed countries, tax exemption threshold of income is generally less than 25 per cent of per capita income.”

“In developing countries, it is mostly equal to or below per capita income. In Bangladesh, the tax exemption threshold is almost 1.5 times above the per capita income.”

The minister also said that the tax-exemption threshold will remain the same as “any increase in the tax exemption threshold will push a significant number of taxpayers out of the tax net, which will eventually erode the tax base.”

“The tax rates for all types of taxpayers except companies have remained unchanged during the last few years. The taxpayers got habituated with this rate of tax. Considering all this, I propose that the tax exempted income threshold and tax rate for all taxpayers except for companies will remain unchanged for the next year,” the minister added.