• Wednesday, Sep 18, 2019
  • Last Update : 08:11 pm

Finance minister: 5% source tax for savings certificate up to Tk5 lakh

  • Published at 05:12 pm July 29th, 2019
AHM Mustafa Kamal
File photo of Finance Minister AHM Mustafa Kamal Courtesy

Fixed income population to benefit the most

Finance Minister AHM Mustafa Kamal has said a 5% tax at source will now be applicable for family savings certificates for up to Tk5 lakh.

At the same time, for investment above Tk5 lakh on family savings certificates, the tax at source will be 10%.

The minister made the disclosure at a press briefing at the secretariat on Monday afternoon.

He also said the 10% tax declared on all savings certificate in the national budget has been eased.

“The decision was taken considering the fixed income population as they will be the ones who will the most benefitted by this change,” he added.

An amended circular will be handed out in this regard soon.

The minister also informed that the affluent population has been buying saving certificates through 20-30 accounts. As such, the government has no idea how much money is being invested in saving certificates.

“This tendency will decrease due to the tax and the ACC would be able to take steps if this does take place,” added the minister.

In the budget for fiscal 2019-20, the government imposed a 5% tax at source on the profit on savings certificate along with the previous 5%.

Although the government is yet to complete the official process in providing incentive to remitters, the minister said banks will pay an additional 2% to the remitters starting from July 1.

The minister also declared that incentives will be provided on remittance. 

"I declared that a 2% incentive will be provided on remittance. The government has taken this step to encourage sending remittances through proper channels. It will take 2-3 months to get the process ongoing. Bangladesh Bank is working on this. The declaration will become operational from July 1."