DSE proposes Tk 1 lakh as tax-free dividend income

The Dhaka Stock Exchange on Sunday proposed that the National Board of Revenue should increase capital market investors’ tax-free dividend income limit to Tk one lakh from existing Tk 25,000 with a view to spur market condition.
The bourse also asked for scrapping of uniform income year or accounting year provision set by the Finance Act, 2015.
The country’s premier bourse placed its proposals to the revenue board on the day for the fiscal budget 2016-17 to be placed at parliament in June.
The proposals were disclosed at a press briefing held at its office in the city on the day.
DSE chairman Siddiqur Rahman Miah, DSE acting managing director Abdul Matin Patwary and DSE directors Shakil Rizvi and Ruhul Amin were present at the briefing.
‘Considering the present market scenario, small investors should be allowed for tax exemption up to Tk 100,000 on dividend income as it will help to attract the small investors to invest in capital market which will ultimately enhance the capital market growth and development,’ the DSE proposal said.
‘If the limit increased, small investors will be benefited as they have suffered a lot due to market turmoil in recent years,’ it said.
The bourse proposed for scrapping the provision of double and tipple taxation on dividend income by resident and non-resident Bangladeshis under section 82c of Finance Act, 2015.
DSE also proposed the NBR to reduce turnover tax to 0.015 per cent from 0.05 per cent in the upcoming fiscal year in a bid to reduce transaction cost for encouraging investors in participating on the trading and for increasing overall turnover of the stock exchanges.
Patwary pointed out logic behind the proposal said deducting tax at 0.05 per cent from turnover is not rational as the brokerage houses were struggling to survive in the ailing market condition for last couple of years.
That is why the tax should be reduced to 0.015 per cent, he said.
Shakil said the tax rate on turnover was increased by the government when the market was on the boom in 2009-10. ‘We were demanding for reduction of the tax rate for last couple of years so that the brokers can get some space to survive,’ he said.
The acting managing director of DSE said, ‘We also in our budget proposal requested the revenue board for restoration of the earlier provision of Finance Act where companies preserved rights to fix their accounting year.’
‘The fixation of income year by the Finance Act,
2015 that said that the accounting year must start from July has raised some regulatory issues, especially for the listed companies,’ he said.
‘The bourse also proposed for full income tax waiver for the demutualised DSE for five years from existing tax rate as the bourse has no earnings from its operation,’ he said.
News Courtesy: www.newagebd.net