The budget for FY20 proposes to impose 0.1 percent surcharge on individual taxpayers with a net wealth of Tk 500 million.

 “An individual taxpayer having a net wealth of Tk 500 million or above will have to pay higher of 0.1 percent of net wealth or 30 percent of his income tax payable as surcharge,” Finance Minister AHM Mustafa Kamal said in the budget speech in parliament on Thursday (Jun 13).

He said that a large number of wealthy declare much less than what they earn. “Consequently, they pay an insignificant amount of surcharge because their revealed little income,” said the finance minister.

At present, wealth tax law does not exist in Bangladesh. Instead of paying wealth tax, wealthy individual taxpayers in Bangladesh pay surcharge at certain rates based on their income tax for the last few years, Kamal said.

Currently, taxpayers with net wealth above Tk 22.5 million have to pay surcharge. The minister, however, proposed to raise the limit to Tk 30 million.

Kamal further proposed a minimum surcharge of Tk 3,000 where net wealth of an individual exceeds Tk 30 million and a minimum surcharge, amounting to Tk 5,000 for individuals exceeding Tk 100 million.

In addition, a 2.5 percent surcharge on the profit of the business of manufacturers of cigarette, bidi, zarda, gul and other tobacco products will remain unchanged.