Charge of additional tax under Section 19(ITA-2023)

 

Charge of additional tax under Section 19 | Bangladesh Income Tax Act -2023

 As per section-19(ITA-2023),

Notwithstanding any other provisions of this Act, if a person engages or permits any individual who is not a citizen of Bangladesh to work in their business or profession during any income year without prior approval from the appropriate government authority, that person shall be liable to pay an additional tax.

This additional tax shall be equal to 50% of the tax payable on their income or BDT 5 lakh, whichever amount is higher, and it shall be payable in addition to the regular tax due under this Act.

Frequently Asked Questions (FAQ): 

1. What is the purpose of Section 19?
Section 19 is designed to regulate the employment of foreign nationals and ensure that proper government approval is obtained before engaging non-Bangladeshi workers.

2. Who is subject to this additional tax?
Any ব্যক্তি (individual, firm, company, or other entity) conducting business or professional activities in Bangladesh who employs a non-citizen without prior government approval.

3. What does “non-Bangladeshi citizen” mean?
It refers to any individual who does not hold Bangladeshi citizenship, regardless of residency status.

4. Is prior approval mandatory for hiring foreign workers?
Yes, approval from the relevant government authority must be obtained before employing any foreign national.

5. What happens if approval is not obtained?
The employer will be liable to pay an additional tax as a penalty under Section 19.

6. How is the additional tax calculated?
The additional tax is the higher of:

• 50% of the tax payable on total income, or
• BDT 5,00,000 (five lakh taka).

7. Is this additional tax separate from regular income tax?
Yes, it is imposed in addition to the normal tax payable under the Income Tax Act.

8. Does this apply to all types of businesses and professions?
Yes, the provision applies broadly to all ব্যবসা (businesses) and পেশা (professions).

9. Does the duration of employment matter?
No, even short-term or temporary employment during the income year can trigger this provision if prior approval was not obtained.

10. Can the additional tax be waived or reduced?
Generally, the law does not provide automatic relief. However, any exception or relief would depend on government policies or specific approvals from the relevant authority.