People’s Lack of Knowledge on Tax Regulations in Our Country

A lot of people across Bangladesh have very little knowledge about the country’s tax regulations. There is very insufficient learning about the application of tax rules. Even many people do not know when paying taxes become obligatory for them in terms of their earnings.

Paying taxes on time is very important for the acquisition of revenue for a country. The money that taxpayers pay to the government plays a big role in that country’s socio-economic advancement.

According to National Board of Revenue (NBR), tax payers have to submit tax returns with tax from 1st July to 31st November every year on their taxable income of previous financial year. But most of the people of Bangladesh/ tax payers are unaware that all income is not taxable & no idea about their tax exemption limit.

How the tax liabilities are determined?

Tax liabilities are calculated on income over tax exemption limit. Tax exemption limits are stated below-
(1) if a person’s yearly income is less than BDT 350000, than he doesn’t have to pay any tax. Moreover, there are some changes in exemptions for women taxpayers,

third gender tax payers, taxpayers aged 65 years or above,
persons with disabilities and gazetted war victim taxpayers.

For example:

• For women taxpayers and the taxpayers above 65 years aged starts their tax brackets from BDT. 400001
• Third gender taxpayers and disable people’s tax bracket starts from BDT. 475001.
• BDT. 500001 in case of gazzetted war casualty freedom fighter taxpayers
• In case of parents of children with special need or autistic the taxable amount increased by BDT 50000.00 from his tax exemption limit.
How is an employee’s tax liability is calculated?

According to Bangladesh income tax act 2023 government employee has to pay income tax only his annual salary, bonus and festival allowance but on the other hand, employees  of private or autonomous organization get tax exemption 1/3 of total income or 450000 tk which is less.

Some unknown tax exemptions -Section 6 of the Income Tax Act, 2023 has tax exemptions/limitations in certain cases. Following are notable  among them.

• Gratuity (which is fully waived up to tk. 2.5 crore).
• All amounts deposited in Recognized Provident Fund are exempt from tax.
• Tax is waived on the entire amount of government pension.
• Some portion of tax is waived on insurance and savings bond money.
• Also, tax is waived on gifts given to various government sectors.
Are these tax exemptions/limitations helpful in paying tax?
Most of the peoples of Bangladesh are not interested in paying taxes, one of the main reason  is awareness about the tax exemptions. Due to the fact that many people are unaware of this issue, so they reluctant to pay taxes. Moreover fear of paying more money at the end of the year as tax . This reluctance/ negativity of paying tax can overcome by national wide publicity by NBR about the tax exemptions through different media like news paper, Radio , Television social media etc.

Remember, "Just as tax is a right of the government, it is the duty of all of us as citizens of the country to pay taxes."
 

Raisa Roushan Nawma is a
student of Bangladesh University
of Professionals (BUP).