Electricity is now indispensable in daily life, whether in rural villages or bustling cities. Yet, for those who fail to submit their income tax returns for the current year, tax authorities have been granted the power to disconnect their electricity supply. This authority extends beyond electricity: gas, water, and other state-provided services may also be suspended under the Income Tax Act.
The recently issued guidelines for the 2025–26 fiscal year outline five measures that tax officials may take against non-compliant taxpayers, one of which is the suspension of utility services.
Five Measures for Non-Filing Taxpayers
| Measure | Description |
|---|---|
| 1. Imposition of Fines | Under Section 266 of the Income Tax Act, failure to file a return may attract a penalty of 10% of the last assessed tax, with a minimum of BDT 1,000. Continued non-compliance incurs an additional BDT 50 per day. Special provisions apply: first-time taxpayers face a BDT 5,000 penalty, while previously assessed taxpayers are liable for 50% of the last assessed tax or BDT 1,000, whichever is higher. |
| 2. Reduction of Tax Concessions | Section 174 allows for the withdrawal or reduction of tax exemptions or benefits, such as investment-related rebates, if returns are not submitted on time. |
| 3. Additional Tax Charges | Late filing triggers a 2% per month surcharge on the assessed tax, increasing the overall tax liability. |
| 4. Disconnection of Utilities | Tax officials may disconnect electricity, gas, water, and other government-provided services if returns are not filed. |
| 5. Salary and Allowance Complications | Filing of income tax returns is mandatory for certain public and private sector employees. Non-compliance may lead to delays or issues in receiving salaries and allowances. |
Who Must File
Two categories of taxpayers are required to submit returns:
Individuals whose taxable income exceeds BDT 3.5 lakh annually.
Those obligated to file returns regardless of income, as proof of submission is needed to access 39 types of government services.
Submission Procedure
Taxpayers can file their annual income tax returns from 1 July to 30 November each year, though this year the deadline has been extended to 31 January. All returns must be submitted online via www.etaxnbr.gov.bd, except for five special categories who are exempt from online filing.
Currently, 11.5 million Tax Identification Number (TIN) holders are registered in Bangladesh, of which 3.1 million have filed their returns this year.
Tax authorities emphasise that failure to submit a return, when taxable income exists or filing is mandatory, gives them the legal right to disconnect essential utilities at residential or commercial premises.