Tax exemptions for government employees have
been increased.
In a notification on Tuesday, the National Board of Revenue (NBR) said that
government employees will no longer have to pay income tax on what they get
except basic salary and bonus.
Government employees used to receive tax exemptions in various instances in
the past. However, this year’s notification has expanded the scope of these
exemptions.
Previously, government employees were entitled to tax exemption in certain
sectors. For instance, if the house rent constituted 50% of the basic salary
or amounted to Taka 3,00,000 or less, it was not subject to taxation.
Similarly, a medical allowance of 10% of the basic salary or up to Taka
1,20,000 was also exempted from taxation.
These exemptions on house rent and medical allowance are applicable to all
working taxpayers.
Apart from this, the list of tax-free allowances of government officials
includes Boishakhi allowance, education assistant allowance, responsibility
allowance, tiffin allowance, entertainment allowance and travel allowance and
dearness allowance.
According to the new law, government employees can avail tax exemption on
one-third of the house rent or whichever is lower, up to Taka 4,50,000, as
allowance.
On Wednesday, the Finance Division issued a notification, granting special
benefits at the rate of 5% to government employees, pensioners, and MPO-
affiliated teachers and employees.
As per the notification, government employees and pensioners will receive a
minimum of Taka 1,000, while pensioners will get a minimum of Taka 500.
Source: Bangladesh Sangbad Sangstha