DHAKA, July 19, 2023 (BSS) - Tax exemptions for government employees have 
been increased. 

In a notification on Tuesday, the National Board of Revenue (NBR) said that 
government employees will no longer have to pay income tax on what they get 
except basic salary and bonus.

Government employees used to receive tax exemptions in various instances in 
the past. However, this year's notification has expanded the scope of these 
exemptions.

Previously, government employees were entitled to tax exemption in certain 
sectors. For instance, if the house rent constituted 50% of the basic salary 
or amounted to Taka 3,00,000 or less, it was not subject to taxation. 
Similarly, a medical allowance of 10% of the basic salary or up to Taka 
1,20,000 was also exempted from taxation.

These exemptions on house rent and medical allowance are applicable to all 
working taxpayers.

Apart from this, the list of tax-free allowances of government officials 
includes Boishakhi allowance, education assistant allowance, responsibility 
allowance, tiffin allowance, entertainment allowance and travel allowance and 
dearness allowance. 

According to the new law, government employees can avail tax exemption on 
one-third of the house rent or whichever is lower, up to Taka 4,50,000, as 
allowance.

On Wednesday, the Finance Division issued a notification, granting special 
benefits at the rate of 5% to government employees, pensioners, and MPO-
affiliated teachers and employees.

As per the notification, government employees and pensioners will receive a 
minimum of Taka 1,000, while pensioners will get a minimum of Taka 500.