Corporate tax cut for listed firms, tax-free dividend income ceiling raised for stock market expansion

Finance Minister AMA Muhith has proposed a cut in corporate tax for companies listed on the stock market and a rise in the ceiling of tax-free dividend income.

He presented the budget for the 2015-16 fiscal on Thursday. 
 
In the budget speech, he said, “Capital market now stands on strong foothold out of continuous efforts in last 4 years. We would like to attract more companies to further expand the capital market.”
 
He proposed to cut the tax rate from 42.5 percent to 40 percent for publicly traded banks, and insurance and other financial institutions.
 
Muhith also proposed a tax reduction from 27.5 percent to 25 percent for other companies listed on the share market.
 
The tax rate for tobacco companies, however, would increase by five percentage points to 45 percent.
 

The threshold of tax exemption on dividend income has been raised from Tk 20,000 to 25,000.

The 10 percent deduction at source on income from share market by any company or joint venture would also be withdrawn, Muhith said.

The former president of the Bangladesh Merchant Bankers’ Association, Mohammad A Hafiz, told bdnews24.com that the budget had several positive measures for the stock market.

He thanked the finance minister for them and hopes they would have a positive impact.