Scope to legalise undisclosed money in capital market to continue
The government may offer a package of facilities for stock markets including an increase in tax exemption limit on income from dividend for small-scale
investors in the budget for next fiscal year 2013-2014.
The package will also allow continuation of the scope of legalising undisclosed money by investing in the stocks, National Board of Revenue officials said.
The NBR has prepared a set of proposals in this regard for inclusion in the next budget for fiscal year of 2013-2014, they said.
According to the proposals, small investors will not be imposed any tax for dividend income between Tk 10,000 and Tk 15,000.
Currently, investors pay tax at the rate of 10 per cent on dividend above Tk 5,000 which they get from the listed companies.
On the other hand, the opportunity of legalising undisclosed money by investing in the capital markets with only 10 per cent tax will continue like previous fiscal years.
‘The government is going to provide those facilities to boost the ailing capital markets in line with the government’s priority,’ an NBR official told New Age on Sunday.
He said the government might also withdraw tax at source on premium of initial public offering and tax at source on income from dividend arising from mutual funds and tax rebate for investment in mutual funds.
The government may also provide some tax facility to the investors for investment in bonds.
Currently, the government deducts tax at source at the rate of 3 per cent on premium of IPO while investors are to pay 10 per cent tax on income from dividend above Tk 25,000.
The NBR is also going to propose 10 per cent tax rebate for investors in case of investment in all mutual funds. Currently investors of Investment Corporation of Bangladesh enjoy such tax rebate.
Officials said that if such proposals are kept finally in the budget, it would attract investors to invest in capital markets that will ultimately boost the markets.
Earlier, in several times, Dhaka Stock Market and Chittagong Stock Market demanded for increasing the tax-free income from dividend to Tk 50,000.
Leaders of the DSE and CSE, country’s two capital markets, said that small investors would be benefited if the ceiling is increased as they have suffered a lot due to market crash since 2010.
The NBR has been providing the scope of investment untaxed money in the capital markets over the last few years but the scope did not attract so many investors though the NBR announced in the FY 2012-2013 that it will not ask any question about the source of such money.
According to NBR statistics, some 82 people legalised Tk 382 crore of undisclosed money through the stock market in the fiscal year of 2011-12.
There is not statistics yet in hand on how many investors took the opportunity in outgoing FY 2012-13.
-With New Age input
