DHAKA, Feb 15, 2022 (BSS) - Bangladesh Merchant Bankers Association (BMBA) today demanded of the government to reduce further the corporate tax rate of the listed companies by 7.5 percent at 15 percent.

BMBA president Md Sayedur Rahman made the proposal at a pre-budget meeting with the National Board of Revenue (NBR) for the next fiscal year (FY23) held at the conference room of the NBR Bhaban in the capital's Segunbagicha area.

Presided over by NBR member (customs policy) Md Masud Sadique, representatives from the Bangladesh Insurance Association (BIA), Dhaka Stock Exchange (DSE), Chattogram Stock Exchange (CSE) placed their various proposals in the meeting.

NBR member (VAT policy) Zakia Sultana and NBR member (Income tax policy) Shamsuddin Ahmed were also present.

Speaking on the occasion, BMBA President Md Sayedur Rahman said that the present corporate tax rate for the listed companies is now 22.50 percent, but despite this, many good companies with strong fundamentals are not being encouraged to become enlisted with the capital market.

"Still there is a lack of good companies with strong fundamentals in the capital market. So, I propose to reduce this tax rate at 15 percent," he added.

Sayedur alleged that there are some companies in the country which are giving lower tax despite making hefty profit as well as enjoying various facilities.

He opined that if such companies could be listed with the capital market through reducing the tax rate, then the revenue collection of the government would increase further.

Currently the corporate tax rate for the non-listed companies is 30 percent, which is 22.50 percent for the listed companies.

The Merchant Bankers Association President also demanded for reducing the corporate tax rate for the merchant banks at 25 percent from the present level of 37.50 percent.

Taking part in the budget discussion, Bangladesh Insurance Association (BIA) executive member and Asia Insurance managing director Imam Shahin proposed for withdrawing the 5 percent gain tax on the profit of the policy holders of the all life insurance companies as per the income tax ordinance of 2014.

He said that due to imposition of such gain tax, the number of policy holders of all life insurance companies is gradually declining while it would be difficult for such companies to do business if such gain tax is not withdrawn.

Shahin also proposed for reducing corporate tax rate in the insurance sector. He said that according to the current income tax act, the corporate tax rate for all the bank, insurance and other financial institutions is 37.50 percent which is very high.

In this connection, he proposed for fixing the corporate tax rate at 30 percent for the life insurance companies and at 35 percent for the non life insurance companies.

DSE chief executive officer Saifur Rahman Majumder proposed for slashing the corporate tax rate for the listed companies at 17.50 percent. He said that if the tax rate is reduced, then transparency would be ensured into the accounts of such companies side by side the revenue collection would be increased further.

GM Golam Faruk of CSE proposed for keeping intact the provision for investing undisclosed money in the capital market adding that if such facility continues, then investment would be increased in the market.

Besides, he also demanded of the government to cancel the source tax on dividend, increasing the tax free income ceiling, giving tax exemption for three years if any SME company get listed with the capital market and then imposing 15 percent tax after that period.

In response, NBR member Masud Sadique said that the revenue board would consider the proposals of the stakeholders after analyzing those.