Income Tax Act 2023
Section 163 - Minimum Tax
(as updated till Finance Act 2024)
(1) Notwithstanding anything contained in any other provisions of this Act, minimum tax shall be payable by an assessee in accordance with the provisions of this section.
(2) Subject to sub-section (3), minimum tax on income on sources from which tax has been deducted or collected under certain sections shall be the following-
(a) any tax deducted or collected at source under the provisions of the sections mentioned in clause (b) shall be the minimum tax on income from the source or sources for which tax has been deducted or collected;
(b) the tax referred to in clause (a) shall be the tax deducted or collected under sections 88-92, 94-95, 100-102, 105, 106, 108, 110-118, 120-129 and 132-139;
(c) for the sources of income for which minimum tax is applicable, books of accounts shall be maintained in the regular manner in accordance with the provisions of section 72;
(d) income from any source, for which minimum tax is applicable under this sub-section, shall be determined in regular manner and tax shall be computed by using the applicable rate on such income; if the tax so computed is higher than the minimum tax under clause (a), the higher amount shall be payable on such income;
(e) income or loss computed in accordance with clause (d) shall not be set off with income or loss, respectively, computed for any regular source.
(3) Tax deducted or collected from the following sources shall not be treated as minimum tax for the purpose of sub-section (2), namely:—
(a) 1[***]
(b) tax collected under section 120 on goods imported by any industrial undertaking, except an industrial undertaking engaged in the manufacture of cement, iron or iron products, ferro alloy products or perfumes, carbonated beverages 2[,powdered milk, aluminium goods, ceramic goods] and toilet water for its own use as raw materials.
(4) Where an assessee has income from a regular source in addition to income from one or more such sources to which minimum tax is applicable under sub-section (2), in that case—
(a) regular tax shall be computed on income from regular sources;
(b) the tax liability of the said assessee shall be the aggregate of the tax as determined under sub-section (2) and the regular tax under clause (a).
3[(5) Subject to the provisions of sub-section (6), any person, irrespective of profits or loss, shall be liable to pay minimum tax on the gross receipts according to the provisions of clauses (a) and (b), namely: —]
4[(a) any company, any trust, any such firm or association of persons having gross receipts of not less than Taka 50 (fifty) lakh, any such individual having gross receipts of not less than Taka 3 (three) crore shall be liable to pay minimum tax in an assessment year on gross receipts at the rate specified in the following table:—
Table
| Serial No. | Type of assessee | Rate of minimum tax |
| (1) | (2) | (3) |
| 1. | Manufacturer of cigarette, bidi, chewing tobacco, smokeless tobacco or any other tobacco products | 3% (three percent) of the gross receipts |
| 2. | Manufacturer of carbonated beverage, sweetened beverage | 3% (three percent) of the gross receipts |
| 3. | Mobile phone operator | 2% (two percent) of the gross receipts |
| 4. | Any individual other than the manufacturer of cigarette, bidi, chewing tobacco, smokeless tobacco or any other tobacco products | 0.25% (zero point two five percent) of the gross receipts |
| 5. | Any other cases | 0.60% (zero point six zero percent) of the gross receipts: |
Provided that, in case where Serial No. 5 of the said table is applicable, such rate of tax shall be 0.1% (zero point one percent) of such receipts for an industrial undertaking engaged in manufacturing of goods for the first 3 (three) income years since commencement of its commercial production; ]
(b) where the assessee has an income from any source that is exempted from tax, the gross receipts from such source or sources shall be shown separately, and the minimum tax under this sub-section shall be calculated in the following manner, namely:—
(i) minimum tax for receipts from sources that are subject to regular tax rate shall be calculated by applying the rate mentioned in clause (a);
(ii) minimum tax for receipts from sources that enjoys tax exemption or reduced tax rate shall be calculated by applying the rate mentioned in clause (a) as reduced in proportion to the exemption of tax or the reduction of rate of tax;
(iii) minimum tax under this sub-section shall be the aggregate of the amounts calculated under sub-clauses (i) and (ii).
(6) If both the provisions of 5[sub-section (4)] and sub-section (5) apply to an assessee, the minimum tax payable by the assessee shall be—
(a) the minimum tax under 6[sub-section (4)]; or
(b) the minimum tax under sub-section (5), whichever is higher.
7[(7) The adjustability of minimum tax computed under this section shall be determined in the following manner, namely:-
(a) the minimum tax calculated under sub-section (2) shall not be refundable or adjustable;
(b) the tax liability created, at the time of computing tax under subsection
(6), in excess of minimum tax paid under sub-section (2) shall be adjustable against the refund created in previous assessment years.]
(8) Where any surcharge, any additional interest, any additional sum, etc. is payable under the provisions of this Act, it shall be payable in addition to the minimum tax.
(9) Where the regular tax computed for any assessment year is higher than the minimum tax under this section, regular tax shall be payable.
(10) For the purposes of this section—
(a) “regular source” means any such source in respect of which the minimum tax under sub-section (2) is not applicable;
(b) “regular tax” means tax computed on regular income using the regular method;
(c) “regular rate of tax” means the rate of tax which would have been applicable unless an exempted or reduced rate of tax were not granted;
(d) “gross receipts” means—
(i) all proceeds derived from the sale of goods;
(ii) all fees or charges received for providing services or facilities, including commissions and discounts;
(iii) all receipts from any source of income.
1 Clause (a) was omitted by section 54(a) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
2 The commas and words “powdered milk, aluminium goods, ceramic goods” were inserted by section 54(b) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
3 The words, figures and marks “(5) Subject to the provisions of sub-section (6), any person, irrespective of profits or loss, shall be liable to pay minimum tax on the gross receipts according to the provisions of clauses (a) and (b), namely: —” were substituted for the words, brackets, figures and marks “Subject to the provisions of sub-section (6), the minimum tax of a person, firm or company shall be as follows, namely:-” by section 54(c)(i) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
4 Clause (a) was substituted by section 54(c)(ii) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
5 The words, brackets and figures “sub-section (4)” were substituted for the words, brackets and figures “sub-section (2)” by section 54(d) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
6 The words, brackets and figures “sub-section (4)” were substituted for the words, brackets and figures “sub-section (2)” by section 54(d) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
7 Sub-section (7) was substituted by by section 54(e) of the Finance Act, 2024 (Act No. V of 2024) with effect from 1st July 2024.
Disclaimer: This is the authentic English text of the Income Tax Act 2023, as published under SRO No. 404-Law/2025 dated 08 October 2025. In the event of any inconsistency or conflict between the content on this website and the official Government publications or gazette notifications relating to laws, rules, regulations or SROs, the official Government publications and notifications shall prevail.