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Be cashless and get tax benefits

Finance Minister Abul Hassan Mahmood Ali gave entrepreneurs from the country’s Information Technology Enabled Services Sectors (ITES) another three years of tax exemptions, provided all their transactions are done through the banking channel.

In a bid to promote a cashless and formalized economy, the government will now offer an income tax benefit to individuals and businesses, provided they conduct all their transactions through banking channels.

In his presentation of the proposed national budget for the financial year 2024-2024, Minister of Finance said Abul Hassan Mahmood Ali gave The entrepreneurs from the country’s Information Technology Enabled Services Sectors (ITES) will be given tax exemptions for another three years, provided all their transactions are done through the banking channel.

In addition, unlisted companies will get 2.5 percentage points of income tax benefit from the existing 27.5%, subject to the condition that more than Tk36 lakh transactions are carried out annually through that company’s banking channel.

Moreover, listed and unlisted companies seeking tax benefits will have to transact through a banking channel after a certain transaction level, in line with the continuation of the previous budget.

Currently, 27 IT services enjoy a tax exemption.

In the upcoming budget, the number of services will be reduced to 19, while four more sectors will be added: artificial intelligence or AI-based solution development, blockchain-based solution development, software as a service and data science with digital data analytics.

The ITES includes cybersecurity services, cybersecurity services, digital data analytics, mobile application development services, software development and customization services, web listings, website development and services, IT assistance and software maintenance services, geographic information services, digital animation development, digital graphic design, digital data entry and processing, e-learning platform and e-publications, IT freelancing, call center service, document conversion, imaging and digital archiving.

The canceled services are: national telecommunications transmission network, IT process outsourcing, website hosting, foreign medical transcription, search engine optimization service, cloud service and system interrogation.

All other ITES on the exemption list will get the tax benefit for another three years by conducting all transactions in cash.