Non Corporate Tax Structure
In the context of I.T.O. 1984
One of the major sources of public revenue to meet a country’s revenue and development expenditures with a view to accomplish some economic and social objectives, such as redistribution of income, price stabilization and discouraging harmful consumption. It supplements other sources of public finance such as issuance of currency notes and coins, charging for public goods and services and borrowings. The term ‘Tax’ has been derived from the French word taxe and etymologically, the Latin word taxare is related to the term ‘Tax’, which means ‘to charge’. Tax is a contribution exacted by the state. It is a non penal but compulsory and unrequited transfer of resources from the private to the public sector, levied on the basis of predetermined criteria. According to Article 152(1) of the Constitution of Bangladesh, taxation includes the imposition of any tax, rate, duty or impost, whether general, local or special, and tax shall be construed accordingly. Rate is a local tax imposed by local government on its residents or the property owners of the locality, a duty is a tax levied on a commodity, and an impost is a tax imposed for an entry into a country. Under the provision of article 83 of the Constitution, “no tax shall be levied or collected except by or under the authority of an Act of Parliament”. The imposition, regulation, alteration, remission or repeal of any tax is dealt with by the ‘Money Bill’, but except in case of reduction or abolition of any tax, the ‘Money Bill’ cannot be introduce in the Parliament without the President’s recommendation. Taxation:
Taxation means an imposition of a non penal, yet compulsory levy for transfer of resources from the private to the public sector, imposed by the public representative on the basis of predetermined criteria and without reference to any specific commitment, in order to accomplish some nation’s economic and social objectives. There are the dues that we pay for the privileges of membership in an organized civil society like Bangladesh. Importance:
Internal resources mobilization gets the top most priority to any good governance which aims at ensuring a balanced economic growth. Income tax plays a very significant role in such a resource mobilization. Good tax laws protect the rights of the citizens, ensure due contribution to the treasury and take care of the national economy too. The more the people will be enlightened about their tax obligations, the les will be the complications for an ongoing economic boost. Income tax is a very political and socially important subject which otherwise tend to reduce the social inequalities through taxing the richer and distributing the same to others through various economic measures.
Classification of Taxpayers:
For the purpose of socio-economic stabilization, taxpayers have been classified either as corporate or non-corporate. Companies, banks, corporations and other statutory bodies have been taken as corporate and the rest e.g. Individuals, firms, H.U.F, A.O.P are designated as non-corporate.
Tax rates, residential status, tax exemptions, rebates etc. and in many other areas, the two groups of taxpayers also differ. Components of Income:
a) Any income, profits or gains, from whatever source derived, chargeable to tax under IT Ordinance; 84; b) Any loss of such income, profits or gains;
c) The profits and gains of any business of insurance carried on by a mutual insurance association computed in accordance with the IT Ordinance; 84; d) Any sum deemed to be income, or any income arising or received or deemed to accrue or arise or be received in Bangladesh.
New provision; 2002: Provided however, that Bonus or Bonus Shares issued declared by a company shall not be included as income of the recipient shareholder.
Income may be “assessable” or “non- assessable”. Non-assessable are totally ignored by tax laws Viz. pension income,...
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