Dhaka Stock Exchange (DSE) Chairman Professor Hafiz Muhammad Hasan Babu put forth a series of proposals, and requested the government to reconsider those in the final budget for the fiscal year 2023-24.
The proposals were aimed at rejuvenating the country’s capital market, the DSE chairman said while addressing a post-budget media briefing at a Dhaka hotel Tuesday.
Professor Hasan Babu, at the press briefing, placed seven key proposals, and said those were required for ensuring the vibrancy in the market.
One of the key proposals presented by the DSE Chairman was the tax exemption on interest income from bond investments. This move aims to inspire investors to engage in bond investments, thereby injecting more funds into the market.
Besides, treating tax at source on companies’ dividend income as the final tax liability was another noteworthy proposal.
“Companies give dividends to their shareholders from their profits after tax. If further tax is imposed on dividend income, it causes a double or triple taxation.”
Professor Hasan Babu also proposed ensuring a minimum tax gap of 10 per cent between listed and non-listed companies. This proposal was aimed at promoting business growth and attracting more companies to the capital market.
The DSE chairman, in another point, proposed to lower the source tax from the income of its TREC holders.
“The key income of brokerage firms is the commission gained against investors’ share trading. If a higher tax is charged from them, it will be tough for them to survive and contribute to the capital market,” he said.
Moreover, in a bid to create a favourable investment environment, the DSE chairman proposed reducing the value added tax (VAT) rate for listed companies, making it more attractive for businesses to come to the stock market.
In another point, Professor Hasan Babu urged to lower the corporate tax rate from small and medium-sized enterprises (SMEs) listed under the bourse’s SME Board.
Furthermore, the DSE chairman underscored the importance of encouraging multinational companies to list and increase their share size, which would not only boost market liquidity but also strengthen investor confidence.
Collaborative efforts among the Bangladesh Bank, the Bangladesh Securities and Exchange Commission (BSEC), and the DSE were also acknowledged at the event. The initiation of system based trial trading for government securities and the launch of trading for SMEs and the alternative trading board (ATB) demonstrat a commitment to improving market efficiency and expanding investment opportunities.
The DSE Chairman also emphasised the need to enhance the image of the stock exchange by providing a smart, seamless trading platform. Recognising the evolving nature of business models and the influence of information technology, he highlighted the importance of digitisation and technological advancements in all aspects of the trading system.
Dhaka bourse’s Acting Managing Director Sattique Ahmed Shah moderated the press conference, while DSE Directors Rubaba Doula and Abdullah Al Mamun, among others, were present there.