Excise duty proposed to be exempted on offshore banking
The finance minister said the exemption will be given to OBUs under the jurisdiction of the Offshore Banking Act, 2024.
The government has proposed to exempt the excise duty on the accounts of the depositors or foreign lenders kept in the offshore banking units (OBU) from the upcoming fiscal year 2024-25 (FY25).
In the proposed budget for FY25, placed in the parliament today (6 June), the minister said the exemption will be given to OBUs under the jurisdiction of the Offshore Banking Act, 2024.
The Parliament passed the Offshore Banking Act 2024 on 5 March, aiming to enhance the country's reserves of foreign currency and attract foreign investment.
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Before that, offshore banking activities were regulated through guidelines issued by the central bank.
According to the law, non-resident individuals or foreign firms who will invest in Bangladesh can open offshore bank accounts. An offshore banking unit will require the Bangladesh Bank's licence to operate, and only scheduled banks working in Bangladesh can provide offshore banking services.
The law also states that offshore banking operations can be executed with five currencies — the US Dollar, Pound, Euro, Yen, and the Yuan.
Moreover, no income tax or any direct or indirect charges will be imposed on the interest or profit earned by the OBUs, and no fees or levies will be imposed on the accounts of depositors or foreign lenders.
