DHAKA, March 12, 2024 (BSS) -  Bangladesh today signed a fresh agreement with the Netherlands to amend the existing double taxation avoidance and prevention of tax evasion agreement by making changes in some articles to widen the tax net and also to explore newer scopes for revenue generation.

Finance Minister Abul Hassan Mahmood Ali and Minister for Tax Affairs and the Tax Administration of the Netherlands, MLA van Rij, signed the agreement on behalf of their respective sides at the Ministry of Finance at Bangladesh Secretariat today, according to a Finance Ministry press release.

There are some 33 articles in the new agreement . Regarding interest, the existing rules have been amended, and provision has been kept for giving tax exemption facilities only to state-owned enterprises.

In terms of the technical services fee, a new article has been incorporated for which it would be possible to realize a maximum 10 percent tax in the case of bill payment against services.

For capital profit, a new condition has been imposed under which it would be possible to collect tax from the capital profit in the source country, Bangladesh.

The new agreement would also pave the way for extending cooperation by both countries to realize tax.

The release said the original agreement on the avoidance of double taxation and the prevention of tax evasion between Bangladesh and the Netherlands was signed on July 13, 1993.

The fresh agreement was signed to amend the previous agreement as part of the government's initiative to remove the dissimilarities of the avoidance of double taxation agreements signed earlier with various countries and also to uphold the interests of Bangladesh.

In the last fiscal year (FY23), Bangladesh exported goods worth over $2 billion to the Netherlands, including knitwear, woven garments, shrimp, footwear, textiles, leather products, and bicycles. On the other hand, Bangladesh imported goods worth $300 million from the Netherlands, including capital machinery, vegetables, food items, minerals, chemicals, pharmaceuticals, organic chemicals, plastic, and rubber.

The Netherlands stands 4th in terms of making FDI in Bangladesh, as the Delta nation made an investment of over $2,560 million in Bangladesh in FY20.

The Netherlands is  one of the 15 top bilateral development partner countries of Bangladesh, while the Netherlands was the 9th top exporting destination of Bangladesh in FY23.

NBR Chairman Abu Hena Md Rahmatul Muneem, Finance Division Secretary Dr. Khairuzzaman Mozumder, and other officials concerned were present on the occasion.