CSE for continuation of money whitening thru stock market – The Financial Express

Forex Market Stock Traders

Chittagong Stock Exchange (CSE) has made a set of demands including the reconsideration of the scope of whitening undisclosed money through capital market by individual taxpayers.

The port city bourse CSE has also demanded exemption of their corporate tax to facilitate the establishment of the country’s maiden commodity exchange (CX).

The CSE chairman Asif Ibrahim on Saturday made the demands at a post-budget press briefing held through webinar.

He said in the proposed budget for the fiscal year (FY) 2022-23, the government has abolished the scope of whitening undisclosed money through capital market paying 10 per cent tax by individual tax payers.

“We are urging the government to restore the facility of whitening undisclosed money through capital market paying 10 per cent tax by individual tax payers. The government’s revenue income will increase and capital flights will decline at this,” said the CSE chairman Mr. Ibrahim.

He said the CSE is working relentlessly to establish the country’s first commodity exchange.

“Our demand is the exemption of corporate tax till June, 2025 as the CSE will have to bear huge expenses to ensure infrastructure development, technical supports, formulation of rules and regulations and create awareness for the commodity exchange,” Mr. Ibrahim said.

Presently, the bourses pay corporate tax at a rate of 30 per cent.

The CSE has also made another demand of reducing tax at source to 0.015 per cent from the existing 0.05 per cent as the operating costs of stock brokers increased many folds to enhance their operational capacity.

In its budget proposal for the FY 2022-23, the government has reduced corporate tax to 20 per cent from 22.5 per cent for the companies that issues shares worth more than 10 per cent of the paid-up capitals.

The existing 22.5 per cent corporate tax has been kept unchanged for the companies that issues shares worth 10 per cent or less compared to their paid-up capitals.

On the other hand, the corporate tax has been reduced to 27.50 per cent from 30 per cent for the non-listed companies.

The CSE has hailed the government’s proposals of reducing corporate tax at different stages.

“The existing corporate tax gap between the listed and non-listed companies is very low. Good companies are not inspired to come to the capital market with a fear of compliances.”

The CSE chairman said corporate tax gap between listed and non-listed companies can be 10 per cent instead of 7.50 per cent to inspire the listing of good companies.

“The capital market will be developed and turnover will also be increased at this, “said the CSE chairman.

He said the companies having good fundamentals will be inspired to avail tax benefit through listing with the bourses if the gap of corporate tax paid by listed and non-listed companies is increased.

“Transparency and accountability are increased in the capital market through the listing of good companies,” said the CSE chairman Mr. Ibrahim.

In its budget proposal the CSE sought zero tax for small cap companies for the first one year of their listing with the SME board.

“Our proposal has not been considered in the proposed budget. The corporate structures of small cap companies will be developed through the listing with the SME board if they are offered with tax benefit.”

In his speech, the CSE chairman has also urged the government to simplify double taxation charged on dividends realised from the dividends of listed companies.

“The tax-free ceiling of cash dividend realised from the listed companies can be increased to Tk 0.1 million from the existing Tk 50,000 taking into accounts the inflation,” said the CSE chairman Mr. Ibrahim.

To facilitate the development of mutual fund industry, the CSE chairman has also demanded full tax waiver for cash dividend realised from the mutual funds or unit funds.

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