Tax-free income threshold to remain Tk3.5 lakh

The government would keep the tax-free income threshold at Tk3.5 lakh.

Finance Adviser Salehuddin Ahmed presented the 2025–26 budget at 3pm on Monday, marking the first for the interim government.

He said that for assessment years 2026–27 and 2027–28, the ceiling will rise slightly to Tk3.75 lakh. It was last raised in FY24 from Tk3 lakh to Tk3.5 lakh for individual taxpayers.

Currently in Bangladesh, annual income up to Tk3.5 lakh is exempt from tax. The next Tk1 lakh is taxed at 5%, so someone earning Tk4.5 lakh a year pays Tk5,000 in taxes.

For FY26, the tax-free income limit for gazetted 'July Warriors' injured in the July 2024 uprising will remain unchanged, but it will rise to Tk5.25 lakh for FY27 and FY28.

The budget also proposes raising the top tax rate from 25% to 30% for high-income earners in FY26, while leaving other tax slabs unchanged from the Finance Act 2024.