The government has proposed withdrawing taxes on income earned by content creators from social media platforms such as Facebook and YouTube, alongside a broader package of tax incentives for freelancers and startup entrepreneurs, in a move aimed at strengthening the country’s growing digital economy and expanding youth employment opportunities.
Finance and Planning Minister Amir Khasru Mahmud Chowdhury announced the proposal while presenting the national budget on Thursday, marking the first budget of the BNP-led government since it assumed office.
At present, income earned by content creators is subject to a 7.5 per cent source tax, which is automatically deducted when earnings are deposited into bank accounts. Under special instructions from Prime Minister Tarique Rahman, the government has proposed making income from the sector completely tax-free.
The proposal comes as the government seeks to expand the information and communication technology (ICT) sector and encourage greater youth participation in digital professions.
According to the BNP’s latest election manifesto, the party has pledged to create 200,000 new jobs in five modern ICT sectors, including cyber security and artificial intelligence (AI), along with another 800,000 jobs in freelancing and content creation. The manifesto also outlines plans for stronger ICT policies, a national cyber security centre, an e-wallet system, 10-year tax benefits for tech entrepreneurs, subsidised loans and a dedicated startup fund.
In parallel, the government has proposed a series of tax incentives for freelancers, content creators and startup entrepreneurs in the national budget for FY2026-27, targeting digital and technology-driven enterprises.
Under the proposal, the existing 15 per cent Value Added Tax (VAT) on services provided by local startup organisations will be withdrawn. Startups will also be exempted from VAT on imported services and on rental costs of offices and other facilities used for business operations.
The finance minister said the VAT exemptions for startups will remain effective until June 30, 2035, providing long-term policy stability for emerging technology-based businesses.
Officials said the measures are expected to encourage innovation, entrepreneurship and greater investment in the startup ecosystem.
The proposed budget also seeks to fully withdraw the 15 per cent VAT currently imposed on services provided by freelancers and content creators. If approved, the exemption will benefit a wide range of professionals, including YouTubers, digital content creators, graphic designers, software developers, online consultants and other independent service providers.
The budget document notes that freelancing, content creation and startup ventures have become important sources of employment and income generation for young people in recent years.
The government has identified these sectors as key pillars of its broader digital transformation and smart economy agenda. The proposed VAT relief is therefore being positioned as a policy step to strengthen the digital economy and create a more enabling environment for innovation-driven enterprises.
The proposals will take effect following parliamentary approval of the Finance Bill and subsequent enactment of the budget for the upcoming fiscal year.
