2024-04-26 01:00:20
The National Board of Revenue (NBR) has withdrawn tax on interest or profits from offshore banking business. Bangladesh Bank has issued a notification instructing the banks to follow this.
The notification issued by the NBR on April 22 said that the interest or profit received by a depositor or a non-resident lender in Bangladesh from an offshore banking unit operated under the Offshore Banking Act 2024 has been exempted from payment of tax under the powers conferred by the Income Tax Act.
On March 5, Parliament passed the ‘Offshore Banking Act, 2024’ bill. Offshore banking is a separate banking service within a bank. Offshore banking is different from conventional banking or branch operations. Because both deposit taking and lending activities in such activities come from foreign sources and are offered to foreign customers. These banking activities are limited to non-residents only. Offshore banking offers opportunities to lend to foreign companies and collect deposits from foreign sources. In offshore banking accounts are done in foreign currency instead of local currency. Interest or profit earned by the offshore banking unit in offshore banking business is tax free.