More tax benefits for foreign officials at high-tech parks [ Tritiyo Matra News ]

More tax benefits for foreign officials at high-tech parks

Local October 18, 2015

The government has relaxed one of the major conditions related to availing tax benefits by the technically-expert foreign employees in the country’s economic zones and hi-tech parks.
It has also offered several tax and duty benefits to the investors and developers in the zones and parks to ‘encourage’ both the foreign and local investment.
The National Board of Revenue in last week issued several statutory regulatory orders in this connection.
According to the SROs, the technically-expert foreigners employed in the economic zones and hi-tech parks will get 50 per cent income tax exemption for three years from the date of their appointment.
Previously, the revenue board had offered such exemption for other sectors from the date of arrival of foreign employees in the country.
Officials said that foreign employees might misuse such benefit by getting job in another company after the completion of three years in a company.
They said that the revenue board had wanted to provide tax benefit to the foreign employees in line with the benefits previously given to other sectors, but the law ministry changed the provision while vetting the SRO saying that the foreign employees might not get job just after their arrival in the country.
The foreigners will not avail the benefit after five years of commercial operation in the company.
The foreign employees will also have to obtain the online taxpayer identification numbers and submit income tax returns regularly for enjoying the benefit.
According to the other SROs, investors in the economic zones will get a full tax waiver on their dividend incomes, capital gains resulting from transfer of shares, and tax on payable royalties, technical know-how and technical assistance fees for 10 years from the date of their commercial operation.
The investors in hi-tech parks, however, will enjoy 50 per cent tax exemption for 10 years for the above mentioned activities.
The NBR also provided complete tax break on dividend income to developers of country’s high-tech parks for 10 years.
The revenue board also offered full exemption from payment of value-added tax on procurement providing services and 80 per cent of VAT on electricity bill.
For enjoying all of these benefits, the developers and investors will have to obtain e-TINs, maintain book of accounts and file income tax returns regularly.
Earlier in July, the NBR offered 10-year tax holiday for investors and 12-year tax holiday for the developers of the economic zones and the high-tech parks.
The NBR also allowed duty-free import of capital machinery, construction materials and development equipment for the economic zone investors.
The government plans to establish 100 economic zones across the country over the next 15 years.
The Bangladesh Hi-Tech Park Authority has also approved six parks. Of which, construction work of two parks — one in Kaliakoir and another in Jessore — are underway.
There are plans to facilitate establishment of 12 more parks in several districts to promote development of IT and information technology-enabled service industries.