Business practicalities in Bangladesh

Land and property rights

Foreigners face some restrictions to property ownership in Bangladesh. While foreign-operated offices may obtain rental or lease agreements for office space, only incorporated companies or joint ventures are permitted to purchase real estate. The Bangladesh Investment Development Authority (BIDA) offers a simplified land registration process through the One Stop Service portal. The BIDA and the Bangladesh Economic Zones Authority (BEZA) provide land acquisition assistance to foreigners doing business in Bangladesh.

Intellectual property (IP)

Despite some progress, the intellectual property (IP) environment in Bangladesh remains challenging due to limited enforcement resources and the widespread availability of counterfeit goods. Bangladeshi authorities are responsive to requests for investigation of IP infringement, but capacity to prioritise complaints, conduct raids or pursue other enforcement actions is limited.

The Government of Bangladesh is actively taking steps to develop an IP framework in line with international standards. However, Australian businesses should be aware of significant risks, particularly in the pharmaceutical and technology sectors.

IP laws and disputes are overseen by the Department of Patents, Designs and Trademarks (DPDT) and the Copyright Office under the Ministry of Cultural Affairs (MOCA). Bangladesh regulates five types of IP: trademarks, patents, industrial designs, copyright and geographical indications.

Violation of IP and enforcement options:

While Bangladesh has made improvements to its IP framework, violations do occur. Businesses or individuals seeking to enforce their IP rights have two options:

• Report violations to police, Customs Intelligence, or VAT Intelligence, all of which have legal authority to enforce IP protections.
• Request that the National Board of Revenue detain or confiscate infringing goods, issue fines and suspend import clearances.

Despite these enforcement options, Bangladesh continues to face challenges due to inconsistent coordination between agencies, a lack of resources to pursue enforcement options and limited IP awareness among regulatory bodies. Businesses can consult IP Australia for advice.

Import duties and tariffs 

Bangladesh imposes tariffs on many imported goods, although waivers are available for some raw material imports. Businesses are advised to use Australia’s Tariff finder tool to identify which customs duties apply to their products. Conversely, because of the country’s status as a Least Developed Country (LDC), Bangladeshi goods are given duty-free and quota-free (DFQF) access to the Australian market.

For more details regarding the specifics of trade with Bangladesh, including rules and restrictions, visit Austrade’s Go Global Toolkit.

Calculations and payments

As a member of the World Trade Organisation, Bangladesh’s customs and duty calculation procedures align with the General Agreement on Tariffs and Trade (GATT). Under GATT’s Valuation Agreement, import duty is calculated by multiplying the goods’ value by the corresponding import duty rate. The dutiable value of imported goods is typically based on the cost, insurance and freight level under International Commercial Terms.

Other taxes and charges

Bangladesh levies a 15 per cent Value Added Tax on most commercial operations. Although Bangladesh and Australia do not yet have a Double Taxation Avoidance Agreement, establishing business operations in one of Bangladesh’s Special Economic Zones (SEZs) or Export Processing Zones (EPZs) can yield tax benefits for Australian businesses. See Section 5.1 for more information on SEZs and EPZs.

Export duties

Bangladesh levies export duties on a range of goods. However, businesses operating in EPZs are eligible for up to 100 per cent export duty exemptions and reduced taxes on export income. Exporters can consult Bangladesh Customs’ Duty Calculator to estimate export duty costs.

Import and export regulations 

Commercial importers and exporters must register with the Chief Controller of Imports and Exports. Most imports to Bangladesh require a letter of credit authorisation form, a bill of lading or airway bill, a commercial invoice or packing list and a certificate of origin. Some imports related to health, security and other restricted sectors require additional documentation. Businesses can consult Bangladesh Customs for additional information on documentation requirements.

Bangladesh also imposes a maximum import entitlement for some machinery and raw materials. This restriction is in place to monitor imports of this type as they usually enter Bangladesh at concessional rates. In addition to a valid Export Registration Certificate, some exports require additional certifications and approval prior to exporting.

Import and export activities are overseen by Bangladesh Customs. Many trade registration services are available through the Bangladesh Investment Development Authority’s One Stop Service Portal. Australian businesses should be aware that foreign companies have reported difficulties with customs processing, including delays and corruption.

In Bangladesh, businesses register for taxation and obtain a Tax Identification Number through the National Board of Revenue (NBR). The NBR oversees taxation of both individuals and businesses. NBR’s regime includes corporate and personal income taxes, capital gains, withholding, gift and value-added taxes. The absence of a Double Taxation Avoidance Agreement (DTAA) between Bangladesh and Australia means that Australian businesses should ensure they are compliant with tax filing and payment procedures in both countries.

This section provides an overview of the taxes Australian businesses can expect to face when operating in Bangladesh. Not all applicable taxes are covered in this guide and the information provided is general in nature. Businesses should seek professional tax advice for understanding the taxes specific to their activities.

Table 1: Overview of Bangladesh’s taxes for businesses

Corporate Income Tax (CIT)

Companies incorporated in Bangladesh are considered resident companies and are therefore required to pay tax on their worldwide income. Non-resident companies, such as a branch office, are only required to pay Corporate Income Tax (CIT) on income earned through activities in Bangladesh. Due to the lack of DTAA between Bangladesh and Australia, all taxes must be paid at the rates set by the Government of Bangladesh. Under the Finance Act 2026 (effective 1 July 2026), corporate tax rates are fixed for five years, from Assessment Year 2026‑27 to 2030‑31.

Bangladesh provides a range of tax incentives for foreign companies. For example, businesses operating within EPZs are eligible for a tax exemption of up to 15 years. See Section 3.2 for additional information about tax incentives.

Personal income tax 

In Bangladesh, individual tax rates depend on residency status. An individual is considered a resident for tax purposes if they:

• stay in Bangladesh for 183 days or more in the relevant tax year; or 
• stay in Bangladesh for 90 days or more in the relevant year and a total of 365 days or more cumulatively during the preceding four years. 

Residents are taxed on their worldwide income, while non-residents only pay tax on the portion of their income earned in Bangladesh. Non-residents are taxed at a flat rate of 30 per cent. The general basic exemption limit is BDT 400,000 (AUD 4,880). Higher exemption limits are available for women, senior citizens over 65 years and other equity-deserving groups. Individuals who qualify as tax residents in Bangladesh are subject to the following progressive tax rates:

Personal income tax rates

Bangladesh also imposes a surcharge on income tax, determined by an individual taxpayer’s net worth. This tax is applied at the following rates:

Surcharge rates on income tax

From the 2026-27 tax year, the minimum tax is excluded from the base on which the net-wealth surcharge is calculated.

Indirect taxes

Value added tax (VAT): In Bangladesh, VAT is generally collected by registered suppliers on taxable supplies. For consumers, VAT is typically borne as part of the purchase price.

Under the Finance Act 2026, VAT returns move from monthly to quarterly filing, alongside automatic eVAT enlistment and digital invoicing. VAT on digital advertising placed through social media, streaming platforms and search engines has been reduced from 15% to 5%, and commercial banks and authorised foreign-exchange dealers now act as withholding agents for VAT on imported foreign services.

Property tax: Property taxes are levied by local jurisdictional authorities. The rate of tax varies across municipalities. It is generally related to the market prices of property in a given locality.

Environmental and travel taxes: Bangladesh imposes a tax on individuals travelling by land, air or sea from or within Bangladesh. The travel ticketing organisation is responsible for collecting this tax and depositing the funds with the government treasury. Tax rates vary by mode of transport. Electric vehicles are exempt from environmental taxes.

Auditing and accountancy play a vital role in enhancing transparency and accountability in a business, especially one engaged in a foreign market. It increases business performance by identifying risks and highlighting areas for improvement.

Accounting standards

Accounting standards in Bangladesh are managed by the Institute of Chartered Accountants of Bangladesh (ICAB). Bangladesh Financial Reporting Standards (BFRS) and Bangladesh Accounting Standards (BAS) are in the process of fully adopting International Financial Reporting Standards (IFRS) and International Accounting Standards. Listed companies and financial institutions are required to follow BFRS and BAS. While it is not strictly mandatory, private companies, unlisted public limited companies and other organisations are strongly encouraged to follow BFRS and BAS.

Although Australian Accounting Standards are also based on IFRS, Australian businesses with operations in Bangladesh should review any differences between jurisdictions to ensure their records are compliant with both countries’ requirements.

Statutory audits

In Bangladesh, all companies are required to undergo annual audits under the Companies Act, 1994. Audits must be conducted by an independent, practicing member of ICAB. These audits are performed following the Bangladesh standards on auditing, which are aligned with the International Standards on Auditing.

Books and records

Companies operating in Bangladesh are required to keep up-to-date financial records. The tax year runs from 1 July to 30 June for most companies. Tax returns must be filed by the 15th day of the ninth month following the end of the tax year, or by the 15th day of September should the 15th day of the ninth month fall prior to this date. Fees apply for late filings. Australian businesses may choose to keep records in a foreign currency for internal purposes. However, all regulatory submissions must be converted into BDT.

Quality control

Audit quality in Bangladesh is impacted by a lack of accounting professionals and a small number of qualified firms. As a result, businesses can face challenges in securing independent auditors. Additionally, Bangladesh lacks the level of audit oversight that is present in other regional economies. Businesses operating in Bangladesh should be aware that these issues can impact access to credit and overall economic stability in the country.

Doing business in Bangladesh will often require employing local and foreign workers. Understanding Bangladesh’s labour market regulations, recruitment methods and country-specific management styles is crucial to building and supporting an effective team.

Labour market

Skill level: Bangladesh offers a young and sizeable workforce that is well suited to many labour-intensive industries. However, while school completion rates have risen since the early 2000s, education levels in Bangladesh remain below the regional average. To address this gap, the Government of Bangladesh is developing a strategy to increase the overall skill level of the workforce. This remains a challenge, as the country absorbs approximately two million people of working age into the workforce annually. While the availability of workers may be beneficial in the future, companies may face shortages of skilled labour in the short term.

Employment contracts: Bangladesh’s Labour Act requires employers to issue formal appointment letters and photo identity cards to employees and workers. Despite this, many workers in Bangladesh work without formal contracts, particularly in the garments sector. Companies are permitted to hire foreign workers after making an inward remittance to the GOB of AUD 75,000. The following types of employment are defined under the Labour Act:

Minimum wage: Minimum wages are set by the Minimum Wage Board of the Ministry of Labour and Employment. Wages differ by industry and level of position. Minimum wage amounts include allowances for housing, food, transportation and medical costs that may be incurred by an employee. Businesses can consult the Minimum Wage Board for up-to-date information.

Human resources and employment law: The Labour Act, 2006 (amended) and the Bangladesh Labour Rules, 2015 are the primary legislative rules governing employment. They regulate terms and conditions for all non-managerial employees under a contract with an employer.

Working hours: Bangladesh’s work week is Sunday to Thursday. Standard work hours for employees are eight hours per day, up to 48 hours per week. The daily limit may be extended to ten hours per day or 60 hours per week with overtime provisions. The annual weekly average of hours worked must not exceed 56 hours. Women are not to be scheduled for work between 10pm and 6am without their written consent.

Holidays and annual leave: All workers who have been continuously employed for at least one year are entitled to one day of paid leave per 18 days worked. Bangladesh also has 17 public holidays that employees generally receive off with pay. If employees are required to work on a holiday, they must be paid 200 per cent of their normal wage and receive a substitute day off.

Employee leave accumulates progressively if not taken. If employment is terminated for any reason and the employee has not used all allocated leave days the employer is required to pay the employee their normal wages in lieu of days off. Employees are also entitled to carry forward unused leave. However, employers must pay out at least 50 per cent of unused leave in the same year in which it is earned. A maximum of 50 per cent of allotted leave may be carried forward for use in future years.

Overtime: Overtime is permitted in most industries up to 12 additional working hours per week for a maximum of 60 hours total. Overtime is compensated at twice the normal rate of pay.

Sick leave: All employees in Bangladesh are entitled to 14 days of paid sick leave per year. Following this period, employees are entitled to disability payments. Rates vary by the duration of leave and the reason for it. Where leave is required due to a workplace accident, employers are responsible for paying employees their full wages plus an additional percentage for up to one year. For occupational disability leave, employees can receive 50 per cent of their wages from the Department of Social Services for up to two years. For permanent disability, employees are entitled to a one-time payment of BDT 250,000 (AUD 3,050). Partial disability entitles an employee to a percentage of this amount, depending on the severity of the disability.

Social, health and unemployment insurance contributions: Almost all private-sector companies in Bangladesh are required to pay five per cent of their annual net profits into a Workers’ Profit Participation Fund (WPPF). The WPPF is distributed to eligible employees on an annual basis. Employees do not contribute to the fund.

Ending employment: In general, employment contracts can be terminated by the employer with sufficient notice. Wages equal to the notice period can be paid in lieu of proper notice. Length of notice depends on the type of employment arrangement and whether the termination is instigated by the employer or the employee.

Severance pay: Severance pay equal to 30 days of wages for each year of service is required upon termination of employment by the employer.

Recruiting staff

Online advertising: To find skilled workers, many companies recruit online to expand their search quickly.

• bdjobs is the largest jobs platform in Bangladesh.
• LinkedIn is a popular choice for professional networking and recruiting for senior positions.
• Bikroy is a well-established local platform for entry-level roles and support staff.

Executive search: Executive search firms can provide tailored searches for more senior roles. Local firms such as Renao offer services in Dhaka.

Work permits: Work permits for foreigners may be obtained through the Bangladesh Investment Development Authority. Investor visas are also available with a letter from the Bangladesh Investment Development Authority or the Bangladesh Export Processing Zone Authority. All visa applications require a valid passport, two recent photos and proof of payment of the visa fee.

Historically, Bangladesh’s banking sector has faced instability due to poor oversight, corruption and political favouritism. The 2023 Amendment to the Bank Company Act introduced several measures to set stricter valuation practices, stronger frameworks to manage weak banks and enhanced regulatory powers for the Bangladesh Bank. However, foreign investors continue to report stress in the banking sector, cumbersome bureaucratic requirements and slow outward repatriation of capital, sales and remittances. The Government of Bangladesh has announced plans to improve accountability and oversight in the banking sector.

However, exporters have reported issues in some cases with the validity of bank-issued letters of credit. Due diligence is advised. For further information contact Austrade.

Bangladesh regulates the activities and capital requirements of four types of financial institutions: state-owned commercial banks, specialised banks, private commercial banks and foreign commercial banks.

Foreign companies establishing a commercial presence in Bangladesh will need a local bank account to conduct business. Business laws in Bangladesh generally require accounts to be kept in BDT, although a 2023 policy change allows foreign investors to retain foreign currency in their accounts for up to one year. Accounts for everyday and business banking may be opened with specialised, private commercial or foreign commercial banks.

Table 2: Financial institutions in Bangladesh

Foreign exchange controls

Unlike many of its regional peers, Bangladesh imposes tight controls of foreign exchange. Despite some liberalisation, the government maintains restrictions on unapproved exchange and transfer of profits from international transactions into non-resident accounts. There is no timeline for removal of these restrictions. Bangladesh is undergoing reforms which may result in greater exchange rate flexibility and banking sector restructuring in the future.

Profit repatriation

Foreign investors may generally repatriate profits from Bangladesh through dividends, branch profits, interest, royalties, technical service fees and sale proceeds from shares or capital. Yet, outward remittances remain subject to foreign exchange controls, tax compliance and documentation requirements. Bangladesh Bank’s 2026 reforms have simplified some share-transfer and sale-proceeds repatriation processes for non-resident investors, including greater processing scope for authorised dealer banks. However, Australian firms should still plan early, as delays may arise from foreign currency availability, Bangladesh Bank approvals, tax clearance, valuation requirements, related-party payment scrutiny and broader banking-sector stress.

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