DSE for hiking tax-free dividend income ceiling

The management of Dhaka Stock Exchange urged the National Board of Revenue (NBR) to increase tax-free dividend income limit to BDT 100,000 from existing BDT 25,000 to rejuvenate market. Considering the present market scenario, small investors should be allowed for tax exemption up to BDT 100,000 on dividend income, the premier bourse said in its budget proposal for the fiscal year 2016-17. The enhancement of tax-free dividend income will help attract small investors to invest in the capital market that will ultimately enhance the market growth and development, the DSE argued. DSE chairman Siddiqur Rahman Miah made the budget proposal public at the press conference at his office in the capital yesterday. The proposal was also placed to the NBR. The DSE also urged the national exchequer to scrap double and tipple taxation on dividend income by including resident and non-resident Bangladeshis under section 82c of Finance Act, 2015. DSE also proposed the NBR to reduce turnover tax to 0.015% from 0.05% in the upcoming fiscal year to reduce transaction cost for encouraging investors to participate in the trading and for increasing overall turnover on the stock exchanges.

Source: http://www.dhakatribune.com/business/2016/may/09/dse-hiking-tax-free-dividend-income-ceiling#sthash.zbQUXdQq.dpuf

Shipment to US slows in Q1 as demand saps

Exports growth in the United States of America slowed down in the first quarter of the year, worsened by sluggish economic recovery in the country’s single-largest shipment destination. Bangladesh’s exports grew by 4.1% to USD 1.5 billion during January to March period of 2016 compared to the corresponding period of last year, data from Office of Textiles and Apparel (OTEXA), a concern of the US Department of Commerce have showed. Export earnings grew by 10.99 per cent in January and 8.5% in January to February in 2016, the data revealed. Out of the total receipts, readymade garment (RMG) fetched USD 1.5 billion during the first quarter of the current calendar year. Bangladesh made shipment of apparel products worth USD 497.7 million in January, USD 485.0 million in February and USD 472.2 million in March in 2016, the US data showed. Non-apparel items including shrimp and plastic products exports stood at $54.71 million during the January to March period showing a slight 0.02% growth. On the other hand, Chinese apparel exports witnessed a negative growth of 5.94 per cent to $ 6.09 billion in the first quarter of this year. Meanwhile, the RMG exports of India grew 4.30 per cent and Vietnam’s 5.7% during the same period.

Source:
http://print.thefinancialexpress-bd.com/2016/05/10/141112
http://www.dhakatribune.com/business/2016/may/10/apparel-export-us-sees-430-rise#sthash.nVwGQQEG.dpuf

Muhith hints at keeping package VAT for SMEs

Finance Minister AMA Muhith hinted Monday that small and medium enterprises (SMEs) might continue to stay under the package VAT system in consideration of their pivotal contribution to the economy. “SMEs having income up to BDT 0.80 million are enjoying the package VAT system and it will be continued,” said the minister in reply when a business delegation requested leaving SMEs out of the purview of the new VAT law. The Dhaka Chamber of Commerce and Industry (DCCI) leaders pointed out that the VAT laws are very complex and it would be very burdensome for the SMEs. In their meeting with the finance minister at his secretariat office the DCCI leaders urged him to simplify the taxation process for SMEs. Although the SMEs are well-covered, the finance minister assured the chamber of continuation of the existing package VAT facilities for such enterprises that contribute about 30% to the GDP. The DCCI business delegation, led by its president Hossain Khaled, also suggested raising the individual income-tax threshold from BDT 250,000 to BDT 350,000. Finance minister also said that the amount of VAT-free turnover ceiling will be raised in the next budget

Source:
http://print.thefinancialexpress-bd.com/2016/05/10/141142
http://www.dhakatribune.com/business/2016/may/09/muhith-softens-tone-flat-vat-rate#sthash.USpFGXT5.dpuf

Project aid component of next development budget 37.0% up

The government is likely to allocate a higher amount, BDT 400.0 billion, in project aid for bankrolling the next development budget although the spending from the current fiscal’s foreign funds dwindled. Officials said Monday that this aid component of ADP for the next financial year (FY), 2016-17, would be 37.0% up over the current fiscal outlay. In the current national budget for 2015-16, the foreign-aid (project aid) component of the Revised Annual Development Programme (RADP) stood at BDT 291.6 billion. Additional Secretary of the Economic Relations Division (ERD) Farida Nasreen said they had finalized the project-aid (PA) outlay that comes from external sources for funding development projects, in a bid to finalize the national budget preparation. The Planning Commission has been working for last couple of months to figure out the ADP for the next fiscal by incorporating the PA into the outlay alongside government’s own resources. It has already reported that the total ADP outlay — donor-supported project aid and funds from government’s own resources — is likely to be in the equivalent of nearly BDT 1.1 trillion in the upcoming national budget.

Source: http://print.thefinancialexpress-bd.com/2016/05/10/141138

Bangladesh to net USD 1.5 billion FDI a year with PPP bait

The country hopes to net some USD 1.5 billion in foreign direct investment (FDI) a year as it has created an enabling investment environment under Public-Private Partnership (PPP) paradigm. Authorities concerned aired such high hopes based on the groundwork done for more than five years with the latest concept of major development works. Investment opportunities under various PPP projects have now been created, paving the way for getting the investment, they said. This should be no less than USD1.5 billion per annum, said one of them. Official sources said contracts on seven PPP projects had already been signed which started fetching investment worth USD1.3 billion. As a good number of PPP projects in sectors like infrastructure, energy, health, and tourism will be ready this year and in the next couple of years, cash flow is expected to continue to increase in the years ahead.

Source: http://print.thefinancialexpress-bd.com/2016/05/10/141131

DCCI backs undeclared funds in real estate

The government should allow the investment of undeclared income in productive sectors to discourage money laundering, Dhaka Chamber of Commerce and Industry said yesterday. A delegation of the chamber led by its President Hossain Khaled submitted the proposals to Finance Minister AMA Muhith at his secretariat. The chamber said most of the undeclared income is sent abroad through illegal channels. “The existing faulty tax system should be upgraded to put off money laundering.” On April 28, the Federation of Bangladesh Chambers of Commerce and Industry said people should be allowed to invest their undeclared incomes in the real estate sector without disclosing the source of the money to any government agency. At present, one can invest undisclosed money in constructing or purchasing a building or an apartment without explaining the source of the income to the National Board of Revenue. The present rules do not guarantee that other government agencies will not raise questions about the source of the funds.

Source: http://www.thedailystar.net/business/dcci-backs-undeclared-funds-real-estate-1221253

Campaigners demand hike in tobacco taxes

Anti-tobacco campaigners yesterday called for increasing taxes on cigarettes, bidi and other tobacco products that have become cheaper in absence of effective taxation. The consumption of cigarettes and raw tobacco takes one lakh lives a year and fuels spending on treatment for smoking related diseases, they said. Nearly 70 lakh adult will give up smoking if the government imposes 70% excise duty on retail prices of cigarettes and cancels the existing price slabs which are used to impose taxes on cigarettes, said Rumana Huque, an economics professor at Dhaka University. She spoke at a discussion on tobacco taxation for fiscal 2016-17, at Cirdap auditorium in the capital. The National Heart Foundation of Bangladesh, United Forum Against Tobacco and Progga, a policy advocacy organization, jointly organized the event as part of a campaign against the use of tobacco. Tobacco items have become cheaper compared to essential items like rice, milk and egg during 2001-2013, she said. The prices of cigarettes and tobacco products are not going up in line with the rise in the purchasing capacity of people, she said.

Source: http://www.thedailystar.net/business/campaigners-demand-hike-tobacco-taxes-1221232

PGCB to set up new substations

Four districts including Dhaka are likely to see improvement in electricity transmission and supply within the next two years, as the state-owned Power Grid Company of Bangladesh (PGCB) has moved to set up new substations and expand the capacity of some existing ones. Under the move, two new 132/33 kV grid substations will be set up-one in Nababganj in Dhaka district, and another in Srinagar of Munshiganj. Meanwhile, the capacity of existing substations of 33 kV in Jhenidah and Magura districts will be extended to 132 kV. The PGCB on Monday struck a deal with a Bangladeshi-South Korean consortium to this effect for implementation, reports UNB. The Energypac-Daewoo consortium will complete the work in the next two years on turnkey basis at a cost of BDT 1.3 billion.

Source: http://print.thefinancialexpress-bd.com/2016/05/10/141115

Safety net spending to rise 19.0% next fiscal year

Expenditure under the social safety net program, including allowance for the elderly and widows, will see a 19% rise in the next fiscal year. The decision came at a meeting on Sunday with Finance Minister AMA Muhith in the chair, where it was agreed that the number of beneficiaries and the amount of money under the program will be increased. At present, BDT 53.6 billion has been allocated for the 18 programs under the social safety net, which will be increased by more than BDT 10.0 billion in fiscal 2016-17, said an official of the social welfare ministry. Of the schemes, the biggest is the one for the elderly, whose count of beneficiaries will be increased by 5.0% or 1.5 lakh people in the next budget. At present, the total number of beneficiaries for old-age allowance is 30 lakh. Each beneficiary gets BDT 400 per month and from the next fiscal year it will be BDT 500. The government last year prepared a national social security strategy with the aim of bringing all vulnerable citizens under the social safety net. More than ten million people will qualify for old age allowance if all poor people above 60 years were to be brought under the social safety net scheme as per the plan.

Source: http://www.thedailystar.net/business/safety-net-spending-rise-19pc-next-fiscal-year-1221247

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