Widen tax gap between listed, non-listed firms: CSE
Chittagong Stock Exchange has called for widening the corporate tax gap between listed and non-listed companies in order to encourage well-performing companies to go public.
The call came yesterday in an online press briefing organised to express the port city bourse's reaction to the proposed national budget.
"The government move to reduce the corporate tax gap between listed and non-listed companies will discourage fundamentally strong companies from coming to the stock market," said Asif Ibrahim, chairman of the bourse.
The finance minister proposed to reduce corporate tax for non-listed companies by 2.5 percentage points to 32.5 per cent.
"We urge the government to reduce corporate tax to 20 per cent from existing 25 per cent for listed companies," he said.
It will give relief to stock investors also as then the listed companies' profits will rise, clarified Ibrahim, also a former president of the Dhaka Chamber of Commerce and Industries.
Moreover, the government can give an incentive to newly listed companies through a tax waiver for three years to encourage non-listed companies into going public, he added. The CSE welcomed the decision of allowing investment of undisclosed money in the stock market for one year.
It will help the market but the condition stipulating that the investment needs to be kept there for three years may have a negative impact because these investors will prefer places where there are no such conditions, said Ibrahim.
In the finance minister's proposal, there is no such binding to invest the money in other sectors.
"Despite our repeated request to reduce the advance income tax to 0.015 per cent from existing 0.05 per cent, it has been kept unchanged," Ibrahim said, adding that such a stance goes against the principle of taxation.
"Because, most of the stock brokers are incurring losses now."
Mizanur Rahman, a commissioner of the Bangladesh Securities and Exchange Commission, said the floor price was set by the commission in a special situation.
"We also want a market force and a free trading system," he said.
Mamun-Ur-Rashid, managing director of the CSE, and directors Anita Ghazi Islam, Md Sayadur Rahman, Emdadul Islam, Sohail Mohammed Shakoor and Md Liaquat Hossain
Chowdhury were present at the event.
Comments