The government, in its proposed budget for FY26, is likely to introduce a new category under personal income tax, titled “July Fighters,” who will enjoy tax relief on their incomes up to Tk5.25 lakh for two years.
The amount will be the same as wounded Liberation War freedom fighters, and will be effective from the subsequent tax year, FY27.
Finance Adviser Salehuddin Ahmed is scheduled to present the national budget for FY26 on Monday.
The benefit will apply to gazetted July Warriors.
The interim government in February earlier this year published a list of 1,401 July Fighters in recognition of their participation in the student-led uprising in July–August last year that toppled the previous Awami League government.
The finance adviser is expected to keep the tax-free income limit for individuals unchanged at Tk350,000 in the next fiscal.
However, sources at the Finance Ministry said that the minimum tax for individuals currently paying Tk3,000 and Tk4,000 could rise to Tk5,000.
Currently, annual income up to Tk3.50 lakh is tax-exempt. The subsequent Tk1 lakh of income is taxed at 5%.
Furthermore, under existing rules, individuals whose annual income exceeded Tk38.5 lakh were subject to a 30% income tax on the remaining income.
However, the new proposal suggests that an individual will fall under the 30% tax bracket once their income exceeds Tk35.75 lakh.
According to the proposed tax rates, the tax-exempt limit for women and senior citizens will be Tk4.25 lakh; Tk5 lakh for persons with disabilities; Tk5.25 lakh for wounded Liberation Wair freedom fighters and July 2024 fighters, and Tk5 lakh for third-gender individuals.
