The much-talked about stocks crash probe report might have been 'incomplete', says the finance minister.
In his bid to save the stock market from further free-fall, Muhith proposed that previous incentives for small investors remain.
During his budget speech on Thursday, AMA Muhith said that in the two years between 2009 and 2011, market capitalisation of the Dhaka Stock Exchange rose by 192 percent.
"This was not desirable," he said adding that many termed it as a catastrophe when the market went through substantial correction towards the end of January this year.
Muhith put on record his "sincere thanks" to the members of the probe committee, led by Ibrahim Khaled, for filing the report in a short time.
"However, due to time constraint, some observations and comments might have remained incomplete," he added.
The finance minister's proposal to exempt stock investors from producing tax identification number (TIN) and to continue the existing tax exemption on proceeds from shares are likely to reassure the small investors about the government's intention to keep the capital market buoyant.
Staying with capital reforms, Muhith mentioned the initiative of demutualisation of the Dhaka and Chittagong Stock Exchanges in an effort to "contain market manipulation".
He also said that the Tk 50 billion open-end Bangladesh fund, a mutual fund, will help regain investors' confidence, stop the continuous price fall as well as bring about strategic development of the market.
"We will remain vigilant about the utilisation of the fund and future negative impact on fiscal sector."
GREAT RATES FOR HIGH DIVIDEND PAYERS
Besides, as a measure to prop up the struggling stock market, the finance minister proposed that listed companies paying over 20 pc dividend be given 10pc tax rebate, while less than 10pc dividend would attract 37.5 pc tax.
The non-listed companies are required to pay 37.5 percent.
Belying speculations that banks will get a tax break, their corporate tax rates will remain unchanged at 42.5 percent.
The tax relief proposal is not applicable to the companies producing cigarettes.
"For the sake of public health, the rate for cigarette manufacturers [is proposed] to be increased to 42.5 per cent to discourage smoking," the finance minister said in his budget speech.
Bank stocks went up Wednesday and Thursday riding largely on report that corporate tax will go down to 40 per cent for commercial banks.
In case of mobile phone companies, the corporate tax remains 45 percent. For the listed ones offering at least 10 percent to the public with not more than five percent pre-IPO placement, the rate will be 35 percent.
The finance minister said that steps had been taken to develop a surveillance software for the Securities and Exchange Commission (SEC) to check irregularities.
He also spoke of an initiative to formulate a Financial Reporting Act as well as setting up a Financial Reporting Council to oversee audit, accounting standards and transparency of listed companies.
"Other than this we have taken up the task of amending the SEC Act, different rules and Companies Act," added Muhith.
The SEC has also started amending its rules for listing to avoid the abuse of
The book-building method, the finance minister said in his speech.
"We have also taken steps to establish a separate Clearing and Settlement Company to settle transactions within the shortest possible time."
In his bid to save the stock market from further free-fall, Muhith proposed that previous incentives for small investors remain.
During his budget speech on Thursday, AMA Muhith said that in the two years between 2009 and 2011, market capitalisation of the Dhaka Stock Exchange rose by 192 percent.
"This was not desirable," he said adding that many termed it as a catastrophe when the market went through substantial correction towards the end of January this year.
Muhith put on record his "sincere thanks" to the members of the probe committee, led by Ibrahim Khaled, for filing the report in a short time.
"However, due to time constraint, some observations and comments might have remained incomplete," he added.
The finance minister's proposal to exempt stock investors from producing tax identification number (TIN) and to continue the existing tax exemption on proceeds from shares are likely to reassure the small investors about the government's intention to keep the capital market buoyant.
Staying with capital reforms, Muhith mentioned the initiative of demutualisation of the Dhaka and Chittagong Stock Exchanges in an effort to "contain market manipulation".
He also said that the Tk 50 billion open-end Bangladesh fund, a mutual fund, will help regain investors' confidence, stop the continuous price fall as well as bring about strategic development of the market.
"We will remain vigilant about the utilisation of the fund and future negative impact on fiscal sector."
GREAT RATES FOR HIGH DIVIDEND PAYERS
Besides, as a measure to prop up the struggling stock market, the finance minister proposed that listed companies paying over 20 pc dividend be given 10pc tax rebate, while less than 10pc dividend would attract 37.5 pc tax.
The non-listed companies are required to pay 37.5 percent.
Belying speculations that banks will get a tax break, their corporate tax rates will remain unchanged at 42.5 percent.
The tax relief proposal is not applicable to the companies producing cigarettes.
"For the sake of public health, the rate for cigarette manufacturers [is proposed] to be increased to 42.5 per cent to discourage smoking," the finance minister said in his budget speech.
Bank stocks went up Wednesday and Thursday riding largely on report that corporate tax will go down to 40 per cent for commercial banks.
In case of mobile phone companies, the corporate tax remains 45 percent. For the listed ones offering at least 10 percent to the public with not more than five percent pre-IPO placement, the rate will be 35 percent.
The finance minister said that steps had been taken to develop a surveillance software for the Securities and Exchange Commission (SEC) to check irregularities.
He also spoke of an initiative to formulate a Financial Reporting Act as well as setting up a Financial Reporting Council to oversee audit, accounting standards and transparency of listed companies.
"Other than this we have taken up the task of amending the SEC Act, different rules and Companies Act," added Muhith.
The SEC has also started amending its rules for listing to avoid the abuse of
The book-building method, the finance minister said in his speech.
"We have also taken steps to establish a separate Clearing and Settlement Company to settle transactions within the shortest possible time."
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