Before discussing the tax rates in Bangladesh, let’s explore the different tax systems. Globally, tax systems are categorized into three main types: Progressive, Regressive, and Proportional. A Progressive tax system imposes higher tax rates on individuals with increasing income levels. Conversely, a Regressive tax system applies lower tax rates as income rises. In a Proportional tax system, a uniform tax rate is levied on all taxpayers regardless of income. Some nations adopt a Hybrid tax system, combining elements from various tax structures.
Bangladesh employs a Progressive tax system to levy income taxes. More than 65% of budget revenue comes from tax revenue 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 will delve into the income tax rates in Bangladesh for the year 2024-2025:
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Individual Income Tax Rates: :
Income tax rates for individual residents for the year 2024-2025 are as follows:
For regular taxpayers:
| Tax Slab 2024-25 | Tax Rate 2024-25 |
| Up to Tk. 3,50,000 | 0% |
| Next Tk. 1,00,000 | 5% |
| Next Tk. 4,00,000 | 10% |
| Next Tk. 5,00,000 | 15% |
| Next Tk. 5,00,000 | 20% |
| Next Tk. 20,00,000 | 25% |
| On Balance | 30% |
For Women and Senior Citizens above 65 years etc.:
Above is the tax exemption limit for regular taxpayers. The tax exemption limits for other types of taxpayers are as follows:
| Tax Payers Type | Proposed 2024-25 In Taka |
| General Taxpayer | 3.50 lakhs |
| Women and & above 65 years of age | 4.00 lakhs |
| Physically Challenged persons | 4.75 lakhs |
| Freedom fighter | 5.00 lakhs |
| Third gender | 4.75 lakhs |
Corporate Tax rates:
Corporate tax rates for other than individuals are as follows:
| Type | Description | Proposed 2024-25 | Conditions 2024-25 |
| Listed | Publicly traded company that transfers shares worth more than 10% of its paid-up capital through IPO | 22.50% | 20% |
| Listed | Publicly traded company that transfers shares worth ten percent or less of its paid-up capital through IPO | 25% | 22.50% |
| Non-listed | Defined in Income Tax Act, 2023 as a company but Non-publicly traded company | 27.50% | 25% |
| OPC | One Person Company (OPC) | 22.50% | 20% |
| Banks, FI, Insurance | Publicly traded bank, insurance, and financial institution (except merchant bank) | 37.50% | Rebate N/A |
| Banks, FI, Insurance | Non-publicly traded bank, insurance, and financial institution | 40% | Rebate N/A |
| Banks, FI, Insurance | Merchant bank | 37.50% | Rebate N/A |
| Tobacco | Company producing all sorts of tobacco items including cigarette, bidi, chewing tobacco, and gul | 45% (+ 2.5% Surcharge) | Rebate N/A |
| Mobile | Publicly traded mobile phone operator company holds at least 10% of its paid-up capital, out of which Pre-Initial Public Offering Placement cannot exceed 5% | 40% | Rebate N/A |
| Mobile | Non-publicly traded mobile operator company | 45% | Rebate N/A |
| Society | Cooperative Society | 20% | Rebate N/A |
Conditions:
a. All types of income and receipts and all types of expenses and investments above 5 lakh Taka in each single transaction and above 36 lakh Taka in total annually must be done through bank transfer.
b. If conditions fulfilled reduced rates are proposed.
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).
