NBR may cut source tax on essential food supplies

To address soaring inflation, the government of Bangladesh considers reducing the source tax on incomes from essential food commodities' supply. Currently at 2%, the tax may drop to 1% starting fiscal year 2024-25, commencing in July. This proposal, likely to be part of the National Board of Revenue's tax-related suggestions for the next fiscal year, aims to alleviate the burden on suppliers amidst persistent inflationary pressures. In April, food inflation surged to 10.22%, straining the purchasing power of low-income groups. Additionally, the Federation of Bangladesh Chambers of Commerce and Industry recommends withdrawing TDS on essential commodity proceeds to curb price escalation. Furthermore, NBR contemplates lowering the source tax rate on various items from 7% to 5% in the upcoming fiscal year.