DHAKA, June 13, 2019 (BSS) – The government will remove double taxation on dividend of the listed companies for creating a strong capital market.
The proposal was revealed today in the proposed budget placed in parliament by finance minister AHM Mustafa Kamal.
“Dividend income from the listed companies shall be tax-free up to Taka 50,000. Special incentives will continue for encouraging investment in the capital market,” the finance minister’s budget speech read.
A strong capital market is required for any strong economy and if an economy is strong, it means that its capital market is also strong, the parliament was told.
“As we want a strong economy, we would like to see the existence of a strong, vibrant and well-functioning capital market. Capital market is the ideal platform to collect fund for long term industrial investment,” the budget speech read.
However, there is a trend in Bangladesh to provide long term bank loans from short term deposits, which is not evident in other countries. It creates mismatch.
“The banks and loan recipients become the loser eventually. We will take effective measures to encourage investors to collect long term fund or finance from the capital market. Under the supervision of Bangladesh Bank, an amount of Taka 856 crore has already been released under the incentive scheme, which shall be reused on a revolving basis for the protection of small investors’ interest,” the budget speech informed.
Training will be provided to potential investors for clear understanding on share market before their investment in the market, the budget speech read.
“Vigilance has been strengthened to ensure compliance of the capital market. We shall offer numerous incentives for the capital market in coming years,” the speech added.