The recently introduced Income Tax Bill 2023 in Bangladesh has redefined the concept of companies, now encompassing English medium schools, private universities, trade organizations, and NGOs, among others, under the corporate tax framework. These newly defined entities will face a 27.5% tax rate on income, while a 0.60% turnover tax will apply when there is no income. The bill also mandates a 10% tax deduction at source, with a 20% penalty for non-compliance.
However, three professional organizations, namely the Institute of Chartered Accountants, the Institute of Cost and Management Accountants, and the Institute of Chartered Secretariate will benefit from special facilities and enjoy tax waivers. The proposed law aims to address misconceptions and discrepancies in defining companies, though some trade leaders and experts argue against treating educational institutions and non-profit organizations as commercial entities. The National Board of Revenue plans to implement the law from 1 July 2023 if it is approved by Parliament.
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