Tax affect the location and structure of foreign investment, How? Location is the important fact of tax rule. Different Location have different tax rules. Some where after tax return on investment is higher or somewhere after tax return is lower. Somewhere have some advantages and some where have disadvantages of investment. So Tax must affect the location and structure of foreign investment. In Bangladesh what are the tax rate, where is the location and what is the structure and must look up to the incentives which is given by Bangladeshi Government. Here investment Board given some tax or non tax incentives by the Bangladesh Investment board.

Investment Incentives Given By Bangladesh investment Board
The democratic government is highly keen to stimulate the economy and transform a poverty-stricken economy to NIE within short time. Government has liberalized the industrial and investment policies in recent years by reducing bureaucratic control over private investment and opening up many areas. Major incentives are as follows:

1. Tax Exemptions : Generally 5 to 7 years. However, for power generation exemption is allowed for 15 years.

2. Duty : No import duty for export oriented industry. For other industry it is @ 5% ad valorem.

3. Tax Law : i. Double taxation can be avoided in case of foreign investors on the basis of bilateral agreements.
ii. Exemption of income tax upto 3 years for the expatriate employees in industries specified in the relevant schedule of Income Tax ordinance.

4. Remittance : Facilities for full repatriation of invested capital, profit and divided.

5. Exit : An investor can wind up on investment either through a decision of the AGM or EGM. Once a foreign investor completes the formalities to exit the country, he or she can repatriate the sales proceeds after securing proper authorization from the Central Bank.

6. Ownership : Foreign investor can set up ventures either wholly owned on in joint collaboration with local partner.

Incentive Details

Tax Holiday
Tax holiday facilities will be available for 5 or 7 years depending on location of the industrial enterprise.
Dhaka and Chittagong Divisions (excluding 3 hill tract districts of Chittagong Division) 5 years
Khulna, Sylhet, Barisal and Rajshahi Divisions And 3 Chittagong hill tract districts  7 years
Tax holiday facilities will be provided in accordance with the existing laws. The period of tax holiday will be calculated from the month of commencement of commercial production. Tax holiday certificate will be issued by NBR for the total period within 90 days of submission of application. This facility can be availed of by industries set up within June 30, 2000 ADB.

Accelerated Depreciation
Industrial undertakings not enjoying tax holiday will enjoy accelerated depreciation allowance. Such allowance is available at the rate of 100 per cent of the cost of the machinery or plant if the industrial undertaking is set up in the areas falling within the cities of Dhaka, Narayangonj, Chittagong and Khulna and areas within a radius of 10 miles from the municipal limits of those cities. If the industrial undertaking is setup elsewhere in the country, accelerated depreciation is allowed at the rate of 80 per cent in the first year and 20 per cent in the second year.

Concessionary Duty on Imported Capital Machinery
Import duty, at the rate of 5% ad valorem, is payable on capital machinery and spares imported for initial installation or BMR/BMRE of the existing industries. The value of spare parts should not, however, exceed 10% of the total C & F value of the machinery. For 100% export oriented industries, no import duty is charged in case of capital machinery and spares. However, import duty @ 5% is secured in the form of bank guarantee or an indemnity bond will be returned after installation of the machinery. Value Added Tax (VAT) is not payable for imported capital machinery and spares.

Rationalization of Import Duty
Duties and taxes on import of goods which are produced locally will be higher than those applicable to import of raw materials for producing such goods.

Incentives to Non-Resident Bangladeshis (NRBs)
Investment of NRBs will be treated at par with FDI. Special incentives are provided to encourage. NRBs for investment in the country. NRBs will enjoy facilities similar to those of foreign investors. Moreover, they can buy newly issued shares/ debentures of Bangladeshi companies. A quota of 10% has been fixed for NRBs in primary public shares. Furthermore, they can maintain foreign currency deposits in the Non-resident Foreign Currency Deposit (NFCD) account.

Other Incentives
• Tax exemption on royalties, technical know-how fees received by any foreign collaborator, firm, company and expert.
• Tax exemption on the interest on foreign loans under certain conditions.
• Avoidance of double taxation in case of foreign investors on the basis of bilateral agreements.
• Exemption of income tax up to 3 years for the foreign technicians employed in industries specified in the relevant schedule of income tax ordinance.
• Tax exemption on income of the private sector power generation company for 15 years from the date of commercial production.
• Facilities for full repatriation of invested capital, profit & dividend.
• 6 months multiple entry visa for the prospective new investors.
• Re-investment of repatriable dividend treated as new investment.
• Citizenship by investing a minimum of US$ 5,00,000 or by transferring US$ 10,00,000 to any recognized financial institution (non-repatriable).
• Permanent residentship by investing a minimum of US$ 75,000 (non-repatriable).
• Tax exemption on capital gains from the transfer of shares of public limited companies listed with a stock exchange.
• Special facilities and venture capital support will be provided to export-oriented industries under "Thrust sectors"
There will be no discrimination in case of duties and taxes for the same type of industries set up by foreign and local investors and in the public and private sectors.