Taxmen would cut investment rebate facility for individual taxpayers by 50 per cent from this year in case of delay in submission of tax returns without prior application to the tax authorities.
In case of delay in submission of tax returns within stipulated deadline, tax rebate facility on investment would be cut to 7.5 per cent.
The revenue board has determined a uniform tax rebate rate at 15 per cent on rebateable amount of taxable income of a taxpayer in the current FY budget.
Until FY 22, tax rebate facility on investment was fixed on the basis income slabs.
Also, taxpayers will be able to enjoy a maximum 20 per cent tax rebate on their taxable income in the current FY which was 25 per cent until FY 22.
An Income Tax Nirdeshika-2022, published last Thursday, clarified the new fiscal measures incorporated in the Finance Act-2022.
A senior tax official said the majority of the existing TIN holders refrained from submission of tax returns without seeking time extension from the tax authorities.
The new measure will compel them to submit tax returns within the deadline, he said.
Time for submission of tax returns by individual taxpayers started from July 1 and it is scheduled to expire on November 30, 2022.
Taxpayers have to count 2.0 per cent monthly interest in case of failure in submission of tax returns within the deadline even though they submit an application seeking time extension.
The provision on obtaining tax rebates has been rationalised in the budget for FY 2022-23 by making the rate of rebates flat 15 per cent for all taxpayers.
However, accounting professionals found the measure discriminatory as the middle-income group of people has to pay more taxes and enjoys less rebates, compared to the well-off section of the society.
From the current FY, people will have to submit the proof of tax return submission for obtaining 40 types of services from both private and government entities.
Snehasish Barua, member of Institute of Chartered Accountant of Bangladesh (ICAB) and Partner of Snehasish Mahmud & Co, said the fiscal measure would encourage compliance of taxpayers to file tax returns.
"It is appreciable but could be enforced by phases to help people accustomed with the new rules," he added.
Individuals who would obtain e-TIN this year could be asked to submit tax returns next year, he added.
A number of investors of the government's savings certificates and other investment tools alleged that they were facing complexities to invest and withdraw money due to not having a tax return slip.
Noorjahan Begum, mother of a remittance earner living in the city's Kalabagan area, said commercial banks declined transactions at her bank accounts as they were asking for a tax return slip.
"It is difficult for me to manage the tax return slip instantly as I haven't had TIN yet," she said.
The government did not make TIN mandatory for opening bank accounts earlier. People having TIN used to pay 10 per cent tax at source on their interest amount of bank deposits while those not having TIN used to pay 15 per cent.
Some 2.4 million people submit tax returns out of 7.5 million TIN holders, said tax officials.
Despite several efforts, the tax authority failed to motivate the TIN holders to submit tax returns voluntarily.
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