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Donation Tax Act, 1990

An Act made to levy taxes on donations

Whereas it is expedient to levy taxes on donations;

Therefore the following Act is herewith made:-

1. Short title and commencement.- (1) This Act shall be called the Donation Tax Act, 1990.
(2) It shall come into force on first July, 1990.

2. Definitions.- (1) Unless there is anything repugnant in the subject or context, in this Act-

a) "Appellate Tribunal" shall mean the Taxes Appellate Tribunal established under the Income Tax Ordinance;
b) "Income Tax Ordinance" shall mean the Income Tax Ordinance, 1984 (XXXVI of 1984);
c) "Deputy Commissioner of Taxes" shall mean a Deputy Commissioner of Taxes as referred to in the Income Tax Ordinance;
d) "Tax Recovery Officer" shall mean a Tax Recovery Officer as referred to in the Income Tax Ordinance;
e) "taxpayer" shall mean anybody liable to pay a donation tax or anybody regarding whom any proceeding under this Act is, or may be taken for the purpose of levying a donation tax;
f) "donation" shall mean the voluntary transfer of money or of any movable or immovable property the cash value of which cannot be ascertained, by one person to another person;
g) "Inspecting Joint Commissioner of Taxes" shall mean an Inspecting Joint Commissioner of Taxes as referred to in the Income Tax Ordinance;
h) "rules' shall mean rules made under this Act.

3. Levying of donation taxes.- Subject to the other provisions of this Act, a donation tax at the rate settled in the Schedule shall be levied on all donations made by whosoever in whatever financial year, beginning from first July, 1990.

4. Exemptions in the case of certain donations.- (1) No donation tax under this Act shall be levied on any donation made by any person in the following cases, namely:-

a) if the donated property is situated outside Bangladesh;
b) if the donation has been made to the Government or a local authority;
c) if the donation has been made for charitable purposes to an institution or fund to which are applicable the provisions of paragraph 12 of the SIXTH SCHEDULE of the Income Tax Ordinance;
d) if the donation not exceeding the value of twenty thousand Takas has been made to give support, on the occasion of his marriage, to a relative who is dependant on the donator;
e) if the donation not exceeding the value of twenty thousand Takas has been made in the form of a policy of insurance or annual allowance to a relative dependant on the donator, except his wife;
f) if the donation has been made in the form of a will;
g) If the donation has been made in consideration of one's death;
h) if the donation has been made to the donator's sons, daughters, father, mother, husband, wife, brothers or sisters.

5. Manner of determining the value of donations.- (1) For the purpose of assessing the tax under this Act, the value of properties other than cash which have been transferred as donations shall be supposed to be the same as would be realized by selling, at the date of the donation, those properties on the free market.
(2) Where it is not possible to determine the value of any property under subsection (1) for reason of its not being saleable on the free market, its value shall be determined in the prescribed form.

6. Assessment and recovery of donation tax.- The Deputy Commissioner of Taxes and the Tax Recovery Officer shall, under their own jurisdiction, assess and recover the donation tax, as the case may be.

7. Return of donations.- (1) Every person who has made a taxable donation in any financial year shall, before the fifteenth september of the following tax year, submit, in the prescribed form, a return relating to his donation to the Deputy Commissioner of Taxes.
(2) If the Deputy Commissioner of Taxes is of the opinion that the donations made by any person in any financial year are liable to a donation tax under this Act, he may, notwithstanding anything contained in subsection (1), give order by notice that that person shall, within the period determined by him, which shall not be less than thirty days, submit a return in the prescribed form.
(3) The Deputy Commissioner of Taxes may, if he thinks fit to do so, extend the period for submitting the return.

8. Payment of the tax.- (1) Every person submitting a return under section 7 shall, at the date of submitting the return or therebefore, pay his tax on the basis of the return.
(2) If any person fails to pay his tax under subsection (1) without sufficient cause, he shall be considered a defaulting taxpayer.

9. Delayed submitting and rectification, of returns.- If any person has not submitted his return within the period referred to in section 7, or thinks that the return submitted under that section should be rectified, he may, at any time before the assessment of the tax, submit his return, or as the case may be, his rectified return.

10. Assessment of the tax.- (1) If the Deputy Commissioner of Taxes is satisfied, after examination of a return submitted under section 7 or 9, that the return is correct and complete, he shall assess the donation tax payable by the taxpayer on the basis of that return.
(2) If the Deputy commissioner of Taxes is not satisfied in the aforesaid manner, he may, by notice, require the taxpayer to present, on the date mentioned in the notice, in his office the evidence etc. in favour of the return.
(3) The Deputy Commissioner of Taxes may, after reviewing the evidence etc. submitted by the taxpayer and, if necessary, giving a hearing, assess the donation tax to be payed by the taxpayer.
(4) If a person fails to submit a return after having received a notice under subsection (2) of section 7, or if he fails to present evidence etc. in favour of his return after having received a notice under subsection (2), the Deputy Commissioner of Taxes may assess the donation tax to be payed by the taxpayer on the basis of the information and evidence available to him.

11. Fine for defaults and concealment of informations.- If any person intentionally gives wrong information in any return submitted by him to the Deputy Commissioner of Taxes, or intentionally fails to submit a return after having received a notice from the Deputy Commissioner of Taxes, the Deputy Commissioner of Taxes may impose a fine which shall not exceed fifty per cent of the donation tax assessed by him and this fine shall be recoverable together with the donation tax:
Provided that, without a reasonable opportunity for a hearing being given to the person concerned and the previous approval of the Inspecting Joint Commissioner of Taxes, no such fine shall be imposed.

12. Appeal etc. .- (1) Any person aggrieved by an order from the Deputy Commissioner of Taxes or a Tax Recovery Officer under this Act may prefer an appeal to the authority to which he might appeal under the Income Tax Ordinance against an order, as if the order had been given in relation to the Income Tax under the said Ordinance, and whatever party has been aggrieved by a decision of the Appeal Authority may prefer an appeal, a revision or, as the case may be, a reference to those authorities to which an appeal, a revision or a reference in respect of a subject relating to the Income Tax may be made against the Appeal Authority under the Income Tax Ordinance.
(2) Appeals, revisions and references under this Act shall be made in the same manner as under the Income Tax Ordinance.

13. Payment demand.- In order to ensure the payment of a tax or fine payable under this Act, the Deputy Commissioner of Taxes shall, in the form prescribed by law, send a notice of demandto the taxpayer, informing him about the tax or fine and the date of payment.

14. Recovery of taxes and fines.- (1) A donation tax or fine referred to in the demand notice given under section 13 shall be paid within the period determined therein and whoever fails to do so shall be deemed a defaulting taxpayer.
(2) Notwithstanding anything contained in this section, if a taxpayer has filed an appeal under section 12, the Deputy Commissioner of Taxes may or may not, on his own or after an application, consider the taxpayer to be in default of payment until the said appeal has been decided on.
(3) Where a donation tax or fine referred to under section 13 has not been paid within the period determined for payment, it shall be deemed an outstanding income tax under the Income Tax Ordinance and it shall be recoverable under that Ordinance.

15. Correction of errors.- The Deputy Commissioner of Taxes or any Authority hearing an appeal or revision relating to a donation tax may at any time, within the period of two years after the giving of an order, correct any obvious error in the said order:
Provided that, without giving reasonable opportunity for a hearing to the taxpayer, no correction shall be made, if such correction entails the increase of the donation tax or fine.

16. Enforcement of a notice.- A notice under this Act shall be enforced in the same way as under the Income Tax Ordinance.

17. Donation Tax Authorities obliged to comply with the orders, directions etc. of the Board.- The Deputy Commissioner of Taxes and the Tax Recovery Officer shall discharge their responsibilities under this Act under the supervision and control of all the officers and authorities under the supervision and control of which they discharge their responsabilities under the Income Tax Ordinance.

18. Restriction on the filing of cases.- No suit shall be brought in any court to set aside or modify an assessment of a tax under this Act and no civil, criminal or other legal proceeding shall be instituted against the Government or any officer or employee of the Government in case that any person suffers, or is likely to suffer, any loss by any action taken in good faith under this Act.

19. Appearance through a representative.- Whoever has been summoned to appear, for the purpose of a proceeding or examination under this Act, before a Deputy Commissioner of Taxes or an authority authorized to hear an appeal or revision relating to a donation tax, may have himself represented by any person authorized by him in this behalf in written form, unless he is summoned to appear in person.

20. Act not to apply in certain cases.- The provisions of this Act shall not apply-

a) in the case of donations made by a statutory institution established or formed by or under any Act;
b) in the case of donations made by an institution or fund exempted from taxes under the purview of Paragraph 1 and 2 of Part B of the Sixth Schedule of the Income Tax Ordinance.

(1) 5 per cent on the first five lakh Takas which exceed the limit of exemption from donation tax.
(2) 10 per cent on the next ten lakh Takas which exceed the value referred to in paragraph (1).
(3) 15 per cent on the next twenty lakh Takas which exceed the value referred to in paragraph (2).
(4) 20 per cent on the balance which exceeds the value referred to in paragraph (3).