NBR revokes tax exemption on foreign income of ocean-going ships
As a result of the move, ship owners in this sector now must pay a 3% source tax on foreign currency earnings from services provided through their ship
The National Board of Revenue (NBR) has revoked the tax exemption facility for ocean-going ships on their foreign income.
The revenue board announced the move in a statutory regulatory order (SRO) issued yesterday (17 December).
As a result of the move, ship owners in this sector now must pay a 3% source tax on foreign currency earnings from services provided through their ship.
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Currently, there are about 100 operating Bangladeshi-flagged ocean-going ships, according to a NBR official.
The official, on condition of anonymity, told The Business Standard that, "implementing this tax could potentially generate around Tk100 crore annually in income tax from this sector".
This decision follows recommendations from the International Monetary Fund (IMF), which has urged the NBR to withdraw tax exemptions granted to various businesses.
Earlier this month, an IMF delegation met with the NBR chairman and revised the revenue collection target, requiring an additional Tk12,000 crore to be collected during the current fiscal year to achieve additional 0.5% tax to GDP growth.
