Dhaka, Bangladesh (BBN)-The Bangladesh Merchant Bankers Association (BMBA) on Tuesday sought reduction of corporate tax to 35 percent from existing 37.5 percent to help small investors in the stock market.
The BMBA also demanded to provide stimulus package for small investors in the stock market, and treating provisioning and write-off loans as tax deductible.
“We appreciate overall reduction of corporate tax to 35 percent for non-listed companies. But the merchant bankers, which also operate as company, are kept out of such tax reduction benefit,” BMBA President Tanjil Chowdhury, said at a press conference in a city hotel.
Chowdhury said the merchant bankers are non-listed companies. So, they should get the benefit of the corporate tax reduction announced in the proposed budget for fiscal 2014-15.
The BMBA president mentioned that among the capital market institutions, currently asset management companies’ tax is 27.50 percent, stock brokers’ tax is 35 percent while only the merchant bankers have to pay 37.50 percent tax though they are the biggest sufferers in the stocks market debacle.
About the stimulus package for small investors, he said the merchant banks waived 50 percent interest on margin loans disbursed against their clients’ portfolios in 2011 as per the government’s instruction for the sake of implementing the capital market refinancing scheme.
The National Board of Revenue (NBR) was supposed to treat the 50 percent interest as allowable expenses in accordance with the government’s assurance.
But the interest is yet to be treated as allowable expenses. They urged the government to consider the written-off amount of loan and interest as allowable expenses under income tax ordinance.
BMBA vice president Akter H Sannamat, secretary general Md Moniruzzaman and other leaders of the association were present at the press conference.
BBN/BB/AD-11:00pm (BST)
