Six sectors enjoyed tax breaks of Tk 33,366cr

Six sectors enjoyed around 40 percent or Tk 33,366 crore of the direct corporate tax expenditures, meaning tax subsidies in the form of rebates, discounts, exemptions and income tax cuts, in fiscal year 2020-21.

That year, the direct corporate tax expenditure amounted to Tk 85,315 crore.

Of the amount, Tk 15,315 crore went to microfinance, Tk 8,380 crore to power and energy and Tk 4,612 crore to hi-tech industries and economic zones.

Another Tk 3,438 crore went to garments, Tk 1,477 crore to IT or software business, and Tk 143 crore to poultry and fisheries.

The data was available in Direct Tax Report 2020-21, made public by the National Board of Revenue (NBR) yesterday.

In fiscal year 2020-21, the government overall provided Tk 1,25,813 crore in subsidies, which accounted for 3.56 percent of the gross domestic product.

According to the government, direct tax expenditure creates employment, stimulates the economy, enables social balance and provides industrial support.

Of the direct tax expenditure, Tk 40,499 crore was provided at the individual level.

The tax expenditure report said it provides policymakers insights into the fiscal and economic impact of tax incentives and deductions.

The aim is to support the government in informed decision-making and striking a balance between economic growth, social goals and fiscal responsibility within the framework of the tax system, it added.