Assignment on

Significant changes in income tax regime after the budget for the fiscal year 2014-215






Submitted by: Symposium
Department of Law
Session- Spring-2014.
5
th
semester.
IIUC, Dhaka.






Submitted to: Mr. Md. Abbas Uddin
Course Teacher.
IIUC,Dhaka.





Date of submission:








GROUP NAME: SYMPOSIUM

No Name ID
01 Umme Kulsum Sathi L121202
02 Litun Khan L121709
03 Farjana Akter L121711
04 Shampa Gaffar L121713
05 Afroza Khanam L113709



















Table of Contents
Contents
Introduction
Types of Income
Methodology
Sources of Income
Tax Rate
Simplification of Income tax return form
E-Payment System
E-TIN Registration System
E-TDS System
Tax Administration Retrieval System
E-Filing
Transfer Pricing and Anti money Laundering
Implementation of VAT Online Project
Recognition of Highest Income Taxpayers















I ntroduction:


Taxation- one of the major sources of public revenue to meet a country's revenue and
development expenditures with a view to accomplishing some economic and social objectives,
such as redistribution of income, price stabilization and discouraging harmful consumption. It
supplements other sources of public finance such as issuance of currency notes and coins,
charging for public goods and services and borrowings. The term Tax has been derived from
the French word Taxe and etymologically, the Latin word Taxare is related to the term 'tax',
which means 'to charge'. Tax is 'a contribution exacted by the state'. It is a non-penal but
compulsory and unrequited transfer of resources from the private to the public sector, levied
based on predetermined criteria.

Types of income:
Income means anything received in cash or in kind unless exempted bylaws.
Assessable Income:
Assessable Incomes are those incomes, which are included in the determination of total income
of a taxpayer.
a) Taxable Income:
Taxable Incomes are those incomes that the tax is to be paid on those incomes.
b) Non taxable income:
Non taxable income is taken into total income for taxation rate purpose but no tax is to be paid
on this part of income.
Non- assessable incomes
Non- assessable incomes are those incomes which are not included in the determination of total
income of a taxpayer.





Methodology:

Among direct taxes, income tax is one of the main sources of revenue. It is a progressive tax
system. Income tax is imposed on the basis of ability to pay. The more a taxpayer earns the more
he should pay''- is the basic principle of charging income tax. It aims at ensuring equity and
social justice.

Sources of I ncome:
For the purpose of computation of total income and charging tax thereon, sources of income can
be classified into 7 categories, which are as follows:

Salaries
Interest on securities
Income from house property
Income from agriculture
Income from business or profession
Capital gains

Tax Rate:
In order to develop a taxpayers friendly revenue administration, besides motivating the
taxpayers to pay more taxes, it is imperative to have the mentality of delivering better services to
the taxpayers. As a consequence to rationalization of duty structure under ongoing trade
liberalization regime, revenues from import are decreasing gradually. This would mean attaching
added importance to domestic VAT and income tax. In this situation, taking the advantage of
advanced technology, we are working to transform NBR into a modern service-oriented
organization. Steps are as follows:
Simplification of Income tax return form:

A new two page simple income tax return form has been introduced to simplify tax payment
system. It can be downloaded easily from the website of National Board of Revenue.

E-Payment System:

Using the Q-Cash network under the platform of e-payment of NBR, income tax, customs duty
and VAT can be paid. To make this system speedier and more user-friendly, the system of
paying taxes directly from taxpayers bank account has been added.

E-TI N Registration System:

NBR has launched a platform with facilities of registration online for the taxpayers with the
objective of generating TIN automatically from 1st July 2013. This platform has been created by
NBR with the financial and technical supports of IFC. Meanwhile, more than 12 lakh taxpayers
have obtained their TIN from this system.

E-TDS System:

With the financial assistance of IFC, an initiative has been taken to introduce Electronic Tax
Deduction at Source (e-TDS) system with the objective of establishing discipline in management
of Tax Deducted at Source and augmenting revenue collection.

Tax Administration Retrieval System:

Tax information retrieval System is being created at the Central Survey Zone under the project
Tax Administration Capacity and Tax Payers Service(TACTS). Once implemented, it would
be feasible to collect information from Bangladesh Road Transportation Authority (BRTA), land
registration offices and other related offices. This will eventually expand tax network and
prevent tax evasion attempts substantially.
E-Filing:
In order to automate the work of the income tax wing, a project titled Strengthening
Governance 73 Management Project(SGMP) has been taken up with the assistance of Asian
Development Bank (ADB). Under this project, procurement and installation of software,
hardware, networking, server etc. will be completed by the end of 2015.

Transfer Pricing and Anti money Laundering:

Transfer Pricing Cell will start working from 1st July 2014 at the National Board of Revenue.
This cell will be effective in preventing money laundering and tax evasion.

I mplementation of VAT Online Project:

The Value Added Tax and Supplementary Duty Act, 2012 will be implemented from 1st July
2015. In order to reach the target, a time-bound implementation plan has been prepared with the
assistance of IMF. Moreover, to support this initiative, a project costing TK 551 crore has also
been taken up. This includes 60 million dollar financial assistance from the World Bank.
Procurement work under the project is in progress.


Recognition of Highest I ncome Taxpayers:

CIP status along with tax cards is given each year to 10 persons and 10 companies paying
highest income tax nationally in order to encourage and give recognition to their contribution. In
addition, 3 top taxpayers and 3 persons paying taxes for longest time are recognized at the
district level with a certificate and a crest.













Income tax slabs for individual taxpayers and rates applicable for all taxpayers for the FY 2014-
2015. Below contains individual income tax and corporate tax proposals for the forthcoming
fiscal year:


Threshold of Taxable Income of Individual Tax Payer Types of Tax payer Threshold of
Taxable Income


Threshold of Taxable Income of Individual Tax Payer
Types of Tax payer
Threshold of Taxable Income
Existing Proposed
General Tax Payer Tk. 2 lakh 20 thousand Tk. 2 lakh 20 thousand
Women tax payer and tax payers of 65
years of age and above
Tk. 2 lakh 50 thousand Tk. 2 lakh 75 thousand
Physically handicapped Tk. 3 lakh Tk. 3 lakh50 thousand
War-wounded gazette freedom
fighters
Tk. 2 lakh 20 thousand Tk. 4 lakh
Individual Tax Rate
Total Income Tax Rate
On first, Tk. 2 lakh 20 thousand of taxable income Nil
On next, Tk. 3 lakh of taxable income
10 percent
On next, Tk. 4,00,000/- of taxable income
15 percent
On next, Tk. 5 lakh of taxable income
20 percent
On next, Tk. 30 lakh of taxable income
25 percent
On the balance of taxable income
30 percent


Conclusion:
Every government needs money to perform civil operations and to administrate the running of
the state. This money is generally collected from the citizens of the state in the name of the tax.
So, it becomes virtually impossible for the government to run without the tax. Every state has his
own way of collecting tax from its citizen.