Chinmay Prasun Biswas:Fishery and poultry, two important associate sectors of agriculture, play important roles in economy of Bangladesh. To encourage these sectors income earned from fish farming was fully exempted from tax during 1980 to 1990 provided that capital investment must not be less than Tk. 10,000/- (SRO 317/1980). Condition of investing 10% of income (if income exceeds Tk. 1,00,000/-) in government securities was imposed later on (SROs 127/2000 and 168/2001).). Tax at reduced rate (zero tax upto Tk. 10,00,000/-, 5% on next Tk. 10,00,000/-, 10% on balance) was imposed in 2015 (SRO 255/2015). This rate was amended in SROs 171/2021 and 157/2022 (zero tax upto Tk. 10,00,000/-, 5% on next Tk. 10,00,000/-, 10% on next Tk. 10,00,000/- and 15% on balance) on income earned from fish-farming and poultry farming. This rate prevailed upto assessment year 2024-25 (income year 2023-24).
According to a report of the Vanik Varta dt. 23-4-2025, NBR officials claim that this low tax rate facility was allowed mainly to develop these sectors but this facility has been misused more. Due to low tax, fish and poultry farms have become a major sector for showing undeclared income. Influential politicians and businessmen preferred these sectors as a machinery for making money paying lesser tax. More than fifty politicians, claiming themselves as fish farmers in their affidavit, contested in election of 2014. Their returns were not even selected for audit.
As fish is cultivated under water, it is not possible for anyone to ascertain the actual production of fish and income from it. Though countable, nobody takes the hazard of counting hens or ducks in a farm and how many eggs they lay. Field-level tax officials have to accept the income shown and tax paid. Many people have taken this advantage of showing their illegal income as income from fish farming and poultry farms paying lesser amount of tax.
As mentioned in that report, a former member of NBR has said that as it is easy to earn black money in this country. Moreover, legal facility to whiten black money existed earlier. Naturally, black money owners will take advantage of it. Tax exemption was definitely necessary for development of these sectors. It was the responsibility of regulatory agencies to monitor the use of this facility. Now, if it is alleged that those sectors did not develop under exemption facility and only black money was whitened utilising that facility, then exemption is not responsible for it. Those who had the responsibility to oversee it are accountable. If exemption is withdrawn now, it will not bring much revenue.
Experts say that there are many instances that any benefit allowed by government has been partly or widely misused. Fisheries and poultry sectors are not exception to it. But it is to be acknowledged that huge amount of fish is produced in Bangladesh. The latest report (prepared on the basis of fish production in 2022 across the world) on the State of World Fisheries and Aquaculture published by the Food and Agriculture Organisation in June, 2024 informs that Bangladesh has elevated itself from 3rd to 2nd position in production of sweet-water fish. As reported, production of sweet water fish was 4,40,000 m/ton in 1980 which was raised to 12,50,000 m/ton in 2020. Total fish production was 4.915 million m/ton in 2022-2023 financial year. There is no scope to disown this report of FAO published biannually.
Around two crores of people are connected with fish farming and trading (report - Bangladesh Fisheries Research Institute in 2024). A major portion of them do not know what exemption is. As reported in Kaler Kantho on 12-8-2022, Bangladesh ranks third in South Asia in chicken production. Information of Directorate of Livestock says that 63.8 million eggs are produced in Bangladesh daily. But as calculated by Bangladesh Poultry Industry Central Council, the number is around 40 to 45 million. Around 70,000 poultry farms are carrying on business commercially. Around 60 lakhs people are engaged in this sector.
This visible development has happened as a result of wide-scale fish and poultry farming. Some people have taken undue advantage but it is a different matter. Income tax offices have legal authority to select any income tax return submitted under self-assessment procedure for audit but it has not been done at least in cases of the names mentioned in the report of Vanik Varta. Income tax offices did not proceed to it probably because they belonged to or remained close to state-power.
Concluding all conjectures income from fish farming and poultry has been practically cancelled in budget of 2025-26 financial year. Regarding exemption it has been mentioned in page 5946 of Finance Ordinance, 2025 -- “ (২০ক) কোন ব্যক্তির হাঁস-মুরগী, চিংড়ি ও মাছের হ্যাচারী, পেলেটেড পোল্ট্রি ফিড উৎপাদন, চিংড়ি ও মাছের পেলেটেড পোল্ট্রি ফিড উৎপাদন, দুগ্ধজাত দ্রব্য উৎপাদন, ব্যাঙ উৎপাদন খামার, বীজ বিপণন, রেশম গুটিপোকা পালনের খামার ইত্যাদি খাতের আওতাভুক্ত অনধিক ৫(পাঁচ) লক্ষ টাকা, ”
The connotation is very clear that income earned upto Tk. 5,00,000/- from these sources will remain exempted from payment of tax. Notable that in all earlier SROs during last 45 years the words হাঁস-মুরগীর খামার ও মৎস্য চায় হইতে আয় were clearly mentioned. But in this year’s amendment only হাঁস-মুরগী, চিংড়ি ও মাছের হ্যাচারী have been mentioned. Hatchery and farming are practically different. So, confusion continues. This amendment literally means that exemption of Tk. 5,00,000/- is not applicable to income earned from fish farming and poultry. In earlier years separate SROs were issued by NBR but no such SRO has yet been published.
It was argued that due to misuse of exemption facility and reduced tax rate this exemption would be withdrawn. For more revenue it is necessary to come out from exemption culture. But according to observers, exemption and misuse of it is not a matter of today. It continued for last 45 years. Was the authority unaware of it during this long time? Actually, not for more revenue but under prescription (please read – pressure) of IMF such decision has been taken.
The writer is a former Commissioner of Taxes