Tax-free dividend income for Investors doubled
Finance Minister AHM Mustafa Kamal has proposed the ceiling for tax-free dividend income up to Tk 50,000 in a bid to encourage stock market investors. At present, the ceiling for tax-free dividend income for individual investors is Tk 25,000. Special incentives will continue for encouraging investment in the capital market, said Mr. Kamal, in the proposed budget for the fiscal year (FY) 2019-20. The Finance Minister also proposed in his budget speech that the double taxation on dividend from listed companies will be removed. Mr. Kamal said a provision was made in the income tax ordinance last year to avoid the multilayer taxation on dividend income. However, the application of the provision was limited only to the resident companies. According to Mr. Kamal, to promote foreign investment, he propose to extend the application of this provision to the non-resident companies as well. The Finance Minister said he wants to enhance the limit with a view to incentivizing the small investors and strengthening the capital market.
FBCCI welcomes scope for whitening black money
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) has welcomed the black money whitening facility in the proposed budget national budget for the 2019-20 fiscal year. The apex trade body also described the budget as ‘public and business-friendly’. Sheikh Fazle Fahim, on behalf of FBCCI, thanked Prime Minister Sheikh Hasina and Finance Minister AHM Mustafa Kamal for announcing such a public and business-friendly budget. Welcoming the black money whitening windows, we see positive things in the budget, he added. He also urged the government and the authorities concerned not to hassle businesses during new VAT law implementation.
Dhaka Bank Chairman re-elected
Reshadur Rahman has recently been re-elected Chairman of Dhaka Bank. The election took place at the bank’s 353rd board meeting on June 12. The Bank also elected Tahidul Hossain Chowdhury (Atik) as its new Vice Chairman. Rahman is a successful entrepreneur and is associated with a great deal of progressive alliance with several companies. He is the honorary consul general of the Republic of Poland in Bangladesh.
Tax on reserve to hit Companies Business expansion: ICAB
The imposition of 15 per cent tax on reserve and retained earnings of listed Companies will reduce capital and expansion scope of the Companies, said the Institute of Chartered Accountants of Bangladesh recently in its post-budget review. Finance minister AHM Mustafa Kamal placed the national budget for the 2019-20 fiscal year before parliament on Thursday. The government has proposed 15 per cent tax on retained earnings and reserve if the figures exceed 50 per cent of the paid-up capital of a listed Company. If a Company has Tk 2 lakh in paid-up capital with Tk 4 lakh retained earnings and Tk 1 lakh reserve, the company must pay additional Tk 30,000 in tax. The ICAB feared that the tax imposition would reduce capital of a Company and would also narrow its Business expansion scope. The government has also imposed tax on the value of stock dividend at the rate of 15 per cent, which will be collected from the listed Companies within sixty days of such dividend declaration. The move will encourage the listed companies to issue cash dividend and increase the government’s tax collection, the ICAB said.
Don’t borrow from Banks for deficit financing: FBCCI
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) recently urged the government to explore all sources other than Banks to finance the budget deficit in the next fiscal year. According to FBCCI President, Sheikh Fazle Fahim, the government’s high volume of Bank borrowing will deter cash flow to the private sector. He called for using various financial tools like infrastructure funds and bonds to fund the deficit financing. He was attending a post-budget press conference in the FBCCI conference room. The finance minister has proposed to borrow Tk 47,364 crore from the Banking system to meet the budget deficit for 2019-20. Terming the budget proposal popular and business-friendly, Mr. Fahim said micro, small and medium enterprises (MSMEs), meaning those with small incomes, should be kept out of the purview of value-added tax (VAT) so that they could grow further.
ACME starts commercial production from IPO project
The Board of Directors of ACME Laboratories has declared the commencement of commercial production of its state of the art Penicillin facility at Dhamrai after successful completion of trial production. The Company noted that the aforesaid Penicillin facility is one of the three projects against which fund raised through Initial Public Offering (IPO). The ACME Laboratories, the country’s oldest Pharmaceutical Company, raised Tk 4.09 billion from the public by using the book building method in early 2016. The drug maker floated 50 million ordinary shares of Tk 10 each with a premium of Tk 67 through an initial public offering for the general and affected investors, and non-resident Bangladeshis.
FE Weekly analysis: Budget makes Investors’ hope a reality
Stocks extended the gaining streak into the third consecutive week that ended on Thursday as investors collected large-cap shares in the run-up to the budget amid high expectation. According to market analysts. The stocks kept gaining as budgetary hopes boosted the market sentiment. The national budget for the upcoming fiscal year (FY), 2019-20, was unveiled on Thursday. In the budget, Finance Minister AHM Mustafa Kamal has proposed an array of incentives for the capital market, including an increase in the tax-free dividend income threshold-up to Tk 50,000 from the existing limit of Tk 25,000. The finance minister also proposed to remove the double taxation of dividends from listed companies. Week on week, the prime index, the DSEX, settled 96.56 points or 1.80 per cent higher at 5,474. Two other indices also ended higher. The DS30 index, comprising blue chips, advanced 29.70 points to finish at 1,918 and the DSE Shariah Index rose 29.80 points to close at 1,244.
One killed in ‘gunfight’ with police
A suspected drug peddler was killed in what po-lice said was a gunfight in Teknaf early yesterday. Russel Mahmud, 36, of Narayanganj, was shot during a police raid in Hoaikong area around 1:30am, said Pradip Kumar Das, officer-in-charge of Teknaf Model Police Station.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
|Nikkei 225|| 21,116.89||↑84.89||↑0.40%|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 52.51||↑0.23||↑0.44%|
|Crude Oil (Brent)||$ 62.01||↑0.70||↑1.14%|
|Gold Spot||$1,341.70|| ↓0.61||↓0.05%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 82.0089|
|GBP 1||BDT 104.4440|
|EUR 1||BDT 93.0090|
|INR 1||BDT 1.1862|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.<