Staff Correspondent:

The upcoming budget may come with some relief for individual taxpayers as the annual tax-free income threshold is likely to be hiked in the next fiscal year, according to tax officials.

Currently, individual taxpayers enjoy a tax-free income limit of up to Tk 350,000. The government is considering raising the limit by Tk 25,000 or Tk 50,000. If approved, the new tax-free threshold will be Tk 375,000 or Tk 400,000.

Finance adviser Salehuddin Ahmed will present the budget for the next fiscal year on 2 June. It will be the first budget under the current interim government.

According to officials of the National Board of Revenue (NBR), the tax structure might be adjusted in the upcoming budget. Now, a 5 per cent tax is levied on the next Tk 100,000 of income beyond the tax-free limit. In the upcoming budget, the threshold might be hiked while keeping the tax rate unchanged. It means the existing tax slabs – 5, 10, 15, 20, and 25 per cent – are expected to remain unchanged.

An NBR official said, “Low-income taxpayers have been under pressure for more than a year. The proposal to raise the tax-free income ceiling is being discussed to offer them some respite.”

The tax-free income limit was last revised in the 2023–24 fiscal year, increasing from Tk 300,000 to Tk 350,000. It remained unchanged in the next year despite a steep rise in inflation.

Particularly, food inflation remained above 10 per cent in 10 consecutive months from March 2024 to January 2025. In July, it even surged to 14.10 per cent, the highest in 13 years.

According to data from the Bangladesh Bureau of Statistics (BBS), the average food inflation between April 2024 and March 2025 is 10.44 per cent.