DSE proposes corporate tax cut for listed companies

The Dhaka Stock Exchange (DSE) has proposed to cut corporate tax rate for listed companies to attract new firms to the market and help improve the net profit.

In its pre-budget proposals to the Finance Ministry and the National Board of Revenue (NBR) on May 12, the premier bourse requested to reduce corporate tax for listed companies by 5 percentage points.

The reduction might result in 20 percent corporate tax for all listed companies excluding financial, telecom and tobacco businesses.

However, the corporate tax on banks, non-banking financial institutions, and insurers was proposed to bring down to 32.5 percent from existing 37.5 percent.

The DSE also appealed to increase the 10 percent tax waiver period for the newly listed companies to three years from the existing one year.

It requested the government to welcome undisclosed money into the capital market without questioning the investor's source of income, if the investors infuse the money for at least two years and at a 5 percent tax.

The bourse also sought tax exemption for itself for an extended period of 10 years, from 2015 to 2025.

It demanded reduction of advance income tax on its members against main board trading activities from 0.05 to 0.015 percent and zero advance tax on the newly created SME board.

The DSE demanded individuals' annual tax free limit for dividend income to raise to Tk 200,000 from existing Tk50,000 and also requested to consider the source tax on dividends as final tax liability to avoid double taxation.

The bourse also wanted to include the Covid-19 charities in tax allowable expenses.

It also demanded a reduction in standard value added tax (VAT) rate to 9 percent from 15 percent, mentioning that no other country in the region pays such a high VAT.

"Rationalisation of VAT rate would inspire people to pay the value added taxes properly and boost the government revenue collection," the DSE added.