Agriculture, Food processing and Agricultural tools
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Producers will get a tax holiday for their first 10 (Ten) years of commercial production for fruit processing, vegetable processing, milk and dairy product processing, baby food production, and agriculture machinery production. This will be only applicable for companies who will start commercial production from 1 July 2021 to 30 Jun 2030.[1]
Condition: – Has to be registered with BIDA. – At least BDT 10 million investment is required. – For fruit processing, vegetable processing, milk and dairy product processing and baby food production all the raw materials have to be locally produced. – At least 30% value addition (in the factory) is required in terms of agriculture machinery production. – Others. |
2 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years[2].
Eligible industries: – Locally produced fruits and vegetables processing, – Agricultural machinery, – Bio-fertilizer, – Biotechnology-based agro product, – Insecticides or pesticides, – Tissue grafting, – Rice bran oil[3]. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | Agricultural products (fruits and vegetables) and processed Agro-products gets an 20% export subsidy. |
2 | Potato exporters gets 20% export subsidy while exporting from Bangladesh. |
3 | Locally owned Agro- processing industries, situated at economics zones will get 4% incentives for product and market diversification. 30% value addition is required to avail the incentive. |
(Up-scaling) RMG
Fiscal Incentives:
Sl. No. | Details |
1 | RMG factories with green building certification will pay income tax at a special rate of 10% where regular rate of corporate tax is 35%.[1] |
2 | RMG factories without green building certification will pay income tax at a special rate of 12% where regular rate of corporate tax is 35%.[2] |
3 | Under bonded warehousing facility[3], 100% export oriented RMG factories can import raw materials duty free at international price.[4] |
4 | Reduced rate of TDS or withholding tax (Tax Deducted at Source): From Export Earnings Tax will be deducted at 0.5% rate, which is generally 1.0%.[5] |
5 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years[6].
Eligible industries: – Artificial or man-made fiber. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export/Cash Incentives:
Sl. No. | Details[7] |
1 | For export oriented RMG factories instead of Customs Bond or Duty Drawback Facility, 4% cash incentive is available against the export amount. |
2 | Export oriented home textiles, terry towel and RMG manufacturing small and medium enterprises will get additional 4% cash incentives. |
3 | If a manufacturer can produce a new item or can export to a new destination (Excluding USA, Canada and EU countries) will get another 4% incentives as expansion support. |
4 | An exporter will get additional 2% with existing 4% cash incentives, total 6% for exporting RMG products to Eurozone. |
5 | Apart from the above-mentioned export incentives, RMG manufacturers will get additional 1% special cash incentive for exporting their products. |
ICT Sector/Software
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | No taxes will be applicable on software development, nation-wide telecommunication transmission network (NTTN) and information technology enabled services (ITeS) provider’s/ operator’s income until 30th June 2024. |
2 | Producers will get a tax holiday for their first 10 (Ten) years of commercial production for motherboard, casing, UPS, speaker, sound system, power supplier, USD cable, CCTV and Pen drive. This will be only applicable for companies who will start commercial production from 1 July 2021 to 30 Jun 2030.[1]Conditions:
– Has to be registered with BIDA. – At least 30% value addition (in the factory) is required in own factory. – Others. |
3 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years[2].
Eligible Industry: – Computer hardware – Artificial intelligence (AI)-based system designing and/or manufacturing – Automation and robotics design and/or manufacturing inc. parts/ components thereof – Nanotechnology-based products Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | 10% export subsidy is available for the export of Software, Information Technology Enabled Services (ITeS) and hardware. |
2 | Locally owned Software, ICT and hardware industries, situated at high tech park will get 4% incentives for product and market diversification. 30% value addition is required to avail the incentive. |
Pharmaceuticals
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Active Pharmaceuticals Ingredients (API) and laboratory reagent producers, registered in Bangladesh will enjoy 100% corporate tax holiday until 2021-22[1]. |
2 | After 2021-22, Active Pharmaceuticals Ingredients (API) and laboratory reagent producers, will further enjoy tax holiday (from 2023-2032) if they could produce API molecules domestically-:
– For 5 API molecules producers will get 100% tax holiday, – For 3 API molecules producers will get 75% tax holiday. |
3 | No AIT will be applicable for API producers on import of chemical compounds (Technical Grade/Chemically pure)[2]. |
4 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years.
Eligible industries: – API and radio-pharmaceuticals, – Pharmaceuticals, – Barrier contraceptive and rubber latex. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. |
Export Cash Incentives:
Sl. No. | Details |
1 | 20% export subsidy on exporting Active Pharmaceuticals Ingredients (API) from Bangladesh. |
2 | 10% export subsidy on exporting pharmaceuticals products including medical/surgical instruments and appliances from Bangladesh. |
Leather & leather product
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Under bonded warehousing facility 100% export-oriented factories can import raw materials duty free at international price. |
Export Cash Incentives:
Sl. No. | Details |
1 | 15% cash incentive is available for exporting leather made goods. |
2 | Factories situated at Leather Industrial Park, Savar or outside of Savar which has personal ETP will get 10% export incentives for exporting leather crust or finished goods. |
Light engineering
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Producers will get a tax holiday for their first 10 (Ten) years of commercial production of specific light engineering products. This will be only applicable for industries who will start commercial production from 1 July 2021 to 30 Jun 2030. Applicable for light engineering products which-
– Will be used only in industrial factories, – Not a complete instrument but only parts. Conditions: – Has to be registered with BIDA. – Others. |
2 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years.
Eligible Industries: – Bi-cycle including parts thereof, – Textile machinery, – Boiler including parts and equipment thereof, – Compressor including parts thereof. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | 15% export incentive is available for exporting light engineering products. |
2 | 15% export incentive is available for exporting accumulator battery. |
3 | 10% export incentive is available for exporting photovoltaic module. |
Jute & (diversified) jute product
Fiscal Incentives:
Sl. No. | Details |
1 | A company engaged in the production of jute products will pay income tax at the rate of 10%[1]. |
2 | The maximum tax rate for taxpayers other than companies will be 10%. |
3 | Reduced rate of TDS or withholding tax (Tax Deducted at Source): From Export earnings tax will be deducted at 0.5% rate, which is generally 1.0%. |
Export/Cash Incentives:
Sl. No. | Details |
1 | 20% cash incentive for exporting diversified jute product. Diversified jute products mean any products that has more than 50% Jute, except Hessian, Sacking, Carpet Backing Cloth (CBC), six or more count jute fiber. |
2 | 12% cash incentive for exporting jute made final goods (Hessian, Sacking, CBC). |
3 | 7% cash incentive for exporting jute fibers (Yarn and Twine). |
4 | 20% Export subsidy against export of carbon and jute particle board produced from jute. |
Plastic
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years.
Eligible Industries: – Plastic recycling. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others |
Export Cash Incentives:
Sl. No. | Details |
1 | 10% export subsidy is available for exporting plastic products. |
2 | 10% export subsidy is available for exporting PET bottle flakes. |
3 | 10% export subsidy is available for exporting Polyester staple fiber produced from PET bottle flakes. |
Ship-building
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Reduced tax rate on export income for shipbuilding companies until 2025.
Reduced rate: – 5% for public listed company, – 10% for non-listed Company[1]. |
Export Cash Incentives:
Sl. No. | Details |
1 | 10% export subsidy is available for exporting plastic products. |
Frozen fish
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Reduced rate of TDS (Tax Deducted at Source): from export earnings, tax will be deducted at 0.5% rate.[1] |
Export Cash Incentives:
Sl. No. | Details |
1 | 2%-10% cash incentives for exporting frozen fish:
Ice cover rate for export of frozen shrimp; -10% cash incentive for up to 20% ice cover rate -09% cash incentive for above 20%-30% ice cover rate -08% cash incentive for above 30%-40% ice cover rate -07% cash incentive for above 40% ice cover rate Ice cover rate for export of other frozen fish; -05% cash incentive for up to 20% ice cover rate -04% cash incentive for above 20%-30% ice cover rate -03% cash incentive for above 30%-40% ice cover rate -02% cash incentive for above 40% ice cover rate |
Home textile
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Under bonded warehousing facility, 100% export-oriented factories can import raw materials duty free at international price. |
2 | Reduced rate of TDS (Tax Deducted at Source): from export earnings, tax will be deducted at 0.5% rate.[1] |
Export/Cash Incentives:
Sl. No. | Details |
1 | For small and medium manufacturers of home textiles and terry towels, 1% cash incentive is available for export. |
Sector Name: Renewable energy
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | A power generating company which will start power generation before 31st December 2022:
– Will get 100% exemption on income from power generation till 2034. – Foreigners working in the sector do not have to pay any tax for three years beginning from the date of arrival in Bangladesh. – Tax exemption on interest payments on foreign loans. – No tax will be charged on payments of royalties, technical know-how, and technical assistance fees. – Tax exemption on gains from the trading of shares in power generation companies. |
Hospital & clinic
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Health care service providers will enjoy a tax holiday on their first 10 (Ten) years on income from health care services. This will be only applicable for hospitals which will start providing services from 1 July 2021 to 30 Jun 2030. Applicable for[1]:
– Hospitals situated outside Dhaka, Narayanganj, Gazipur and Chattogram district. – Exemption will be allowed for income from treatment and diagnostics services only, other income (if any) will not be eligible. – This should be a hospital with at least 250 beds for children and newborns, women and maternal health, oncology and well-being, and preventive medicine units. – Or, must be a specialized hospital with at least 200 beds. – Others. |
Automobile/ parts manufacturing and servicing
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Income generated from automobiles (three and four-wheeler) made in Bangladesh will be exempted from tax for first 10 years of production and will enjoy reduced tax rate for the next 10 years.
Conditions: – At least BDT 1 billion investment is required. – For the first 10 years, 30% value addition is compulsory to get 100% tax exemption. – For the next 10 years, if they can achieve 40% value addition then tax rate will be only 10% otherwise general tax rate will be applicable. – Within first 5 years after getting approval; car engine, transmission system, and steering system has to be added from own factory. |
2 | Industries established or will be established within 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 up to 10 years.[1]
Eligible Industries: – Automobile, – Automobile parts/ component. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | 10% export subsidy is available for exporting motorcycle from Bangladesh. |
Handicraft & cottage industries
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | 100% export income will be exempted from tax until 2024. |
Export Cash Incentives:
Sl. No. | Details |
1 | Handmade products (hogla, straw, sugarcane/ coconut husk, leaves/ shells, garments of garments) Clothing etc.) Will receive 10% export subsidy. |
Energy efficient appliances, electronic goods/materials
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Producers will get a tax holiday for their first 10 (Ten) years of commercial production electronic goods. This will be only applicable for industries which will start commercial production from 1 July 2021 to 30 Jun 2030.
Eligible products: – Washing machine, – Blender, – Microwave oven, – Electric sewing machine, – Induction cooker, – Kitchen hood, Conditions: – 30% value addition is compulsory |
2 | Factories established or will be established within 1st July 2019 to 30th June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 to up to 10 years[1].
Eligible industries: – Resistor, capacitor, transistor, integrated circuit, multilayer PCB etc., – Electrical transformer, – LED TV, – Mobile phone, etc. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | 10% Export incentive for exporting consumer electronics, electrical home and kitchen appliances.[2] |
Seed
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Exempted tax rates will be applicable for seed producers and on marketing of domestically produced seeds[1].
– Only 3% tax will be applicable up to BDT 10 lakh. – Only 10% tax will be applicable from BDT 10 lakh to up to BDT 20 lakh. – Only 15% tax will be applicable on balance amount. |
Export Cash Incentives:
Sl. No. | Details |
1 | 20% export subsidy on crop and vegetable seed exports. |
Toy
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Factories established or will be established with in 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 to up to 10 years.
Eligible industries: – Toy. Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Agar
Export Cash Incentives:
Sl. No. | Details |
1 | 20% export subsidy is available for Agar and Attar. |
Furniture
Fiscal Incentives-Income Tax:
Sl. No. | Details |
1 | Factories established or will be established with in 1 July 2019 to 30 June 2024 and start commercial production within the same period will be eligible for phased or partial tax exemption from 5 to up to 10 years.
Eligible Industries: – Furniture Conditions: – Paid-up capital of not less than BDT 2 million on the date of beginning of commercial production. – 30% of the exempted has to be reinvested in the same or other industrial undertakings within one year. – Others. |
Export Cash Incentives:
Sl. No. | Details |
1 | 15% export incentive is available for exporting furniture. |