CSR spending ceiling for corporate taxpayers to go up
The government is likely to increase the threshold of tax-free income derived from agricultural activities in a bid to encourage people to engage in the sector, officials of the National Board of Revenue said. The tax-free income limit for agriculture sector may be set at Tk 1 lakh from the existing Tk 50,000, they said. They said that the government might also raise the ceiling of expenditures for activities under corporate social responsibility to encourage corporate taxpayers to spend their income in social welfare, they said.
The ceiling for CSR expenditures might be raised to Tk 12 crore from the existing Tk 8 crore.
Finance minister Abul Maal Abdul Muhith may propose the measures in his budget speech in parliament on June 5.
Officials of NBR said that the areas for CSR expenditures prescribed by the revenue board might also be widened by adding some more new areas so that corporate taxpayers can spend their CSR money for ensuring social welfare.
Corporate taxpayers including banks and financial institutions and the Federation of Bangladesh Chambers of Commerce and Industry have been demanding for increasing the ceiling.
They said that the government should increase the ceiling and make easier the conditions for availing the tax benefits against the CSR expenditures so that corporate taxpayers could widen their activities in a bid to perform their social obligation.
Currently, corporate taxpayers can enjoy 10 per cent tax rebate on their profits on CSR expenditures up to 20 per cent of their annual income or Tk 8 crore, which is less.
The government has specified some areas like natural disaster funds, organisations related to education and health where a company is allowed to spend its CSR funds and enjoy the tax benefit.
According to the law, the companies have to take prior approval from the NBR in spending CSR money to get the tax rebate.
-With New Age input