Finance bill passed, Tk 4 lakh tax-free threshold

Collected Photo

The Parliament has passed the Finance Bill 2026, raising the tax-free income threshold for individual taxpayers, withdrawing three proposed tax measures and approving a series of tax and VAT reforms.

Finance Minister Amir Khasru Mahmud Chowdhury moved the bill on Monday, which Parliament passed by voice vote. Speaker Hafiz Uddin Ahmad Bir Bikram presided over the sitting.

Under the new provisions, the tax-free income threshold has been set at Tk400,000 for the 2026-27 and 2027-28 fiscal years, Tk450,000 for 2028-29 and 2029-30, and Tk500,000 for 2030-31.

The bill also withdraws the proposed requirement to disclose investment information, as well as proposals to make Taxpayer Identification Number (TIN) certificates mandatory for opening most bank accounts and for the registration of partition deeds and mutation documents.

It also reduces the income tax rate for private universities from 10 per cent to 5 per cent and extends existing tax exemptions for indigenous communities in the three hill districts and the plains to cover salary income alongside income from business,agriculture and other economic activities.

The bill also provides customs duty and VAT relief for key sectors, including shrimp, pharmaceuticals, manufacturing and automobile sectors, reduces VAT on digital advertising from 15 per cent to 5 per cent, exempts VAT on BTRC revenue-sharing agreements and fish supplies, and eases VAT compliance requirements for selected business sectors.