Finance Minister AMA Muhith has proposed tax imposition on the bonus and all other festival allowances of government employees.
While placing his budget speech in the National Parliament on Thursday, the minister said: “As per existing provision, all allowances excluding basic salary of government employees are tax free which is discriminatory.
“As first step to remove such discrimination, I propose similar tax treatment on basic salary, bonus and festival allowance for both government and non-government salaried employees.”
The minister also informed the house that the salary of government employees will increase soon.
Keeping these hikes in mind, the government has allocated 17.62% or Tk520bn of the proposed national budget for paying the public servants.
The review committee of the National Pay and Service Commission (NPSC) has set Tk75,000 as the highest wage for government officials.
The committee also hiked the lowest wage to Tk8250 from Tk8,000.
The government plans to implement the hikes from July this year. The 8th National Pay and Services Commission was formed in November 2013.
Once the new structure is implemented, salaries of around 1.3 million public servants will rise by 87 to 101%.
