Bangladesh Securities & Exchange Commission (BSEC) prescribes 05-years tax holiday for foreign firms relocating to Bangladesh Japan, China & Hong Kong are ahead in the race to relocate their manufacturing industries to grab the opportunities
Tax Incentives & Benefits for Investors / User in Bangladesh Special Economic Zone (SEZ):
SL No Incentives Approved Incentives by Governing Board
01 Custom Duty Duty free import of raw materials, construction materials, capital machineries, finished goods.
02 Tax Holiday For all Economic Zones Income Tax Holiday (ITH)
03 Income Tax Exemption from dividend tax (After tax holiday over)
04 Repatriation Full repatriation of capital and dividend.
05 Free Flow FDI No ceiling of FDI.
06 Backward Linkage 100% backward linkage raw-materials and accessories to sell for export oriented industries( EOI) in Domestic Tariff Area (DTA).
07 Local Sale 20% sale of finished product to DTA (From Export Processing Area –EPA).
08 Sub-contracting Sub-contracting with DTA allowed.
09 Stamp Duty 50% exemption of stamp duty and registration fees for registration of leasehold land/ factory space.
10 VAT 80% exemption of VAT on all utility services consumed inside the zone
11 Custom Duty Duty exemption on Export
12 Custom Duty on Vehicle Exemption of CD for import of 2 vehicles within 1st 5 years for foreign investors (for one time).
13 Double Taxation Exemption of double taxation subject to Double taxation agreement.
14 IT Individual 50% Rebate of income tax on salary income of expatriates for 5 years.
15 Custom Bond Consider EZ as custom bonded area.
16 Foreign Exchange FC loan availability (To ease business activity).
17 Foreign Exchange FC Account for Non-Resident.
18 Foreign Exchange FC Account for both local and joint venture industry.
19 JV Joint venture allowed
20 Royalties Royalty, technical fees will be exempted from income tax.
21 Capital Gain Tax exemption on capital gain.
22 Share transfer Share transfer allowed.
23 Work permits No restrictions on issuance of work permits on project related foreign nationals and employees but limited up to 5% of total employees.
24 Citizenship Citizenship for investment of US$ 500000 or more
25 Reinvestment Re-investment of remit-table dividend to be treated as new foreign investment.
26 Resident Resident visa for investment of US$ 75000 or more.
According to IMF, the Bangladesh economy will rise to $322 billion by 2021 creating enormous economic opportunities. Young and energetic work force, nearly 60% of the total population is economically active and almost a million graduates enter the workforce annually. Bangladesh’s Geo-strategic location in the vicinity of China and India also puts further credence to the argument that the country’s economy would forge ahead in the future. Bangladesh has overcame the energy crisis as the current installed capacity is 13,705 MW and Government is importing LPG & LNG through private initiatives. Bangladesh has already graduated to a lower mid-income state and targets to be a mid-income state by 2021 and a developed nation by 2041.