Generally, there are three types of tax systems around the world. These are Progressive tax system, Regressive tax system, and Proportional tax system. In a Progressive tax system, the tax rate increases as the taxpayer’s income increases. Conversely, in a Regressive tax system, the tax rate decreases as the taxpayer’s income increases. On the other hand, in a Proportional tax system, the same tax rate is applicable to all taxpayers. Additionally, some countries followed Hybrid tax system, which uses a mix of different tax systems. The National Board of Revenue (NBR) regulates income taxes in Bangladesh. In addition, the tax system uses two concepts: Income Year and Assessment Year. This guide provides all rates for the Assessment Year. This blog post discusses the income tax rates in Bangladesh for the year 2023-2024:
Individual Income Tax Rates: :
Income tax rates for individual residents for the year 2023-2024 are as follows:
For regular taxpayers:
| Income range | Tax Rate |
| Up to BDT 350,000 | 0% |
| BDT 350,001 to BDT 450,000 | 5% |
| BDT 450,001 to BDT 750,000 | 10% |
| BDT 750,001 to BDT 1150,000 | 15% |
| BDT 1150,001 to BDT 1650,000 | 20% |
| Above BDT 1650,001 | 25% |
For Women and Senior Citizens above 65 years:
| Income range | Tax Rate |
| Up to BDT 400,000 | 0% |
| BDT 400,001 to BDT 500,000 | 5% |
| BDT 500,001 to BDT 800,000 | 10% |
| BDT 800,001 to BDT 1200,000 | 15% |
| BDT 1200,001 to BDT 1700,000 | 20% |
| Above BDT 1700,001 | 25% |
For disabled taxpayers and third-gender individuals:
| Income range | Tax Rate |
| Up to BDT 475,000 | 0% |
| BDT 475,001 to BDT 575,000 | 5% |
| BDT 575,001 to BDT 875,000 | 10% |
| BDT 875,001 to BDT 1275,000 | 15% |
| BDT 1275,001 to BDT 1775,000 | 20% |
| Above BDT 1775,001 | 25% |
For Freedom Fighters:
| Income range | Tax Rate |
| Up to BDT 500,000 | 0% |
| BDT 500,001 to BDT 600,000 | 5% |
| BDT 600,001 to BDT 900,000 | 10% |
| BDT 900,001 to BDT 1300,000 | 15% |
| BDT 1300,001 to BDT 1800,000 | 20% |
| Above BDT 1800,001 | 25% |
Tax rates for Companies:
| Types of companies | Tax Rates | Tax Rates (For Non-Compliance) |
| Publicly Traded companies (More than 10% of paid up capital through IPO) | 20% | 22.50% |
| Publicly Traded companies (Less than 10% of paid up capital through IPO) | 22.50% | 25% |
| Companies but not publicly traded | 27.50% | 30% |
| Single Person Company | 22.50% | 25% |
| Bank, Insurance, and Financial Institution (listed) | 37.50% | N/A |
| Bank, Insurance, and Financial Institution (non-listed) | 40% | N/A |
| Tobacco companies | 45% | N/A |
| Mobile Phone Operator Company (listed) | 40% | N/A |
| Mobile Phone Operator Company (non-listed) | 45% | N/A |
Tax rates for other than Companies:
| Types | Rates |
| Non-Resident Bangladeshi | 30% |
| Tobacco | 45% |
| Trust, Fund, AOP, and others | 27.5% (The tax rate is 30% if each transaction above BDT 500,000 & Annually above BDT 3600,000 is not transferred through a bank) |
| Co-operative societies under the Co-operative Societies Act 2001 | 15% |
| Private Institutions (Universities, Medical Colleges, Dental Colleges, Engineering Colleges, Colleges of IT-related subjects) | 15% |
Read more: A guide to set off and carry forward of losses.
This article is written by Monir Bhuiyan, a member of ACCA (Association of Chartered Certified Accountants) and ICAB (Institute of Chartered Accountants of Bangladesh).
