42 allowances for government employees are tax-exempt.

Bangla Press Desk: Forty-two types of allowances and benefits for government employees have been exempted from income tax, subject to specific conditions. These are outlined in the National Board of Revenue's (NBR) income tax guidelines for the 2026-27 fiscal year. However, basic salary, festival allowances, and bonuses remain subject to taxation.
In addition to their basic salary, government employees receive various allowances based on their rank, responsibilities, and the nature of their employment. Many of these allowances qualify for tax exemption, provided specific rules and conditions are met; however, not all employees are eligible for every type of allowance. The 42 tax-exempt allowances and benefits include:
Medical allowance, New Year's allowance, house rent allowance, rest and recreation allowance, education assistance allowance, charge allowance, hill allowance, travel allowance, commuting allowance, tiffin allowance, clothing allowance, entertainment allowance, laundry allowance, special allowance, deputation allowance, and deputation allowance for training institutes.
The list also includes judicial allowance, *chowki* (outpost) allowance, domestic aid allowance, risk allowance, acting allowance, motorcycle allowance, armourer allowance, unconditional commuting allowance, telecom allowance, cleaner allowance, driver allowance, mounted police allowance, PBX allowance, armed branch allowance, bugler allowance, nursing allowance, daily or subsistence allowance, traffic allowance, ration money, border allowance, batman allowance, instructional allowance, appointment allowance, outfit allowance, and guard police allowance.
However, the relevant rules and conditions apply to determining whether these listed allowances qualify for tax exemption. Consequently, the mere inclusion of an allowance in the list does not automatically guarantee tax exemption in every instance. Income Subject to Income Tax
For government employees, basic salary, festival allowances, and bonuses are included in taxable income in accordance with established rules. In other words, while certain allowances may be tax-exempt, not all income earned by employees falls outside the scope of taxation.
When filing an income tax return, it is essential to separately calculate taxable income and tax-exempt allowances. In this regard, the guidelines and applicable provisions for the relevant tax year must be followed.
There are also discussions regarding the new pay structure, salary increments, and the payment of arrears for government employees. However, details such as which month's salary will include the new pay structure and the method of paying arrears need to be confirmed based on relevant government notifications and directives.
According to NBR guidelines, the income for the relevant tax year and the calculation of applicable tax must be disclosed in the income tax return. Therefore, before submitting the return, one should verify the conditions for tax-exempt allowances, the amount of taxable income, and the calculation of applicable tax.
BP/TD