Satellite Company gets 5-yr tax break

Bangladesh Satellite Company has been exempted from tax payments for five years from now on income generated by Bangabandhu Satellite-1, Bangladesh's first geostationary communication satellite launched nearly four years ago.

The National Board of Revenue (NBR) offered the tax break in a notification issued last week.

However, the state-run company has to properly maintain accounts and timely submit income tax returns, it added.

The move coincides with the company taking up plans to launch Bangabandhu Satellite-2, an earth observatory satellite for collecting image and mapping data for proper planning in areas such as agriculture and forestry.

The government launched Bangabandhu Satellite-1 in May 2018 for the expansion of internet and telecommunication services in remote areas under a Tk 2,765 crore project.

Located 36,000 kilometres away from Earth, the satellite is equipped with 40 transponders. It provides services to Bangladesh and South Asian countries along with Indonesia, the Philippines, Myanmar, Tajikistan, Kyrgyzstan, Uzbekistan, Turkestan and a part of Kazakhstan.

Bangladesh Satellite Company recorded generating Tk 37.54 crore in revenue in fiscal year 2019-20 in the form of bandwidth charges. The company is yet to release its annual report for last fiscal year.

But Managing Director Md Shafiqul Islam said its revenue grew significantly in fiscal year 2020-21 after the company started providing services to local television channels from October 2019.

"We are really happy," he said, explaining that the tax exemption would enable investing in the launch of the second satellite.

"We are providing telecommunication and ICT services and we have to create a new market for revenue. For this, we need breathing space," said Islam.

The company earlier requested that the NBR provide a 10-year tax break.

A senior NBR official said the advantage was to enable making saving and providing better services.

"Bangladesh had to buy these services before the launch of the satellite. Now, the (company) helps save foreign currency by providing the services," he said.