The government is likely to reduce corporate income tax for publicly traded commercial banks, non-banking financial institutions and insurance companies by 2.5 per cent while increase corporate tax for listed cigarette companies by 5 per cent in the upcoming national budget, finance ministry officials said.
Finance minister AMA Muhith is likely to place the proposals before the parliament on June 4.
Currently banks and NBFIs have to pay 42.5 per cent corporate income tax and the rate is likely to be cut down to 40 per cent for banks and NBFIs listed with the country’s stock market, they said.
Corporate tax rate for other companies which are listed with the capital market will also be cut down to 25 per cent from the existing 27.5 per cent.
The government has made the decision to provide incentive for the publicly traded companies from the sectors, encourage others to be listed in the country’s stock market and to rationalise the corporate tax structure, the officials said.
Currently, there are more than 300 companies listed with the Dhaka Stock Exchange and Chittagong Stock Exchange. Of which, 46 are from the insurance sector, 30 banks and 23 non-bank financial institutions.
Foreign banks and new banks are currently not listed with the stock market.
The government has also decided to increase corporate income tax for listed cigarette companies to 45 per cent from the existing 40 per cent as part of the move to discourage tobacco consumption in the country.
The tax rate for non-listed cigarette companies will remain unchanged at 45 per cent.
The tax rate for individual taxpayer will also be set at 45 per cent on individual’s income derived from tobacco business if the business is not registered as a company.
Currently, an individual taxpayer pays income tax at regular rate ranging from 10 per cent to the highest 30 per cent on any income.
The officials said the government would gradually rationalise the corporate income tax structure and bring it down to the level of individual tax rate in line with the international practice.
Corporate tax rate is significantly high in Bangladesh compared with other countries in Asia and the developed world, officials of the National Board of Revenue said.
At present, there are different rates of corporate income tax for companies. The general corporate tax is at 35 per cent for non-listed companies, 27.5 per cent for listed companies, 42.5 per cent for banks, NBFIs and insurance companies, 37.5 per cent for merchant banks, 45 per cent for cigarette companies and mobile phone operators, and 40 per cent for listed cigarette companies and telecom operators.
In the next budget proposals, there might be no change in tax rates for telecom companies and non-listed companies, the officials said.
Finance minister AMA Muhith is likely to place the proposals before the parliament on June 4.
Currently banks and NBFIs have to pay 42.5 per cent corporate income tax and the rate is likely to be cut down to 40 per cent for banks and NBFIs listed with the country’s stock market, they said.
Corporate tax rate for other companies which are listed with the capital market will also be cut down to 25 per cent from the existing 27.5 per cent.
The government has made the decision to provide incentive for the publicly traded companies from the sectors, encourage others to be listed in the country’s stock market and to rationalise the corporate tax structure, the officials said.
Currently, there are more than 300 companies listed with the Dhaka Stock Exchange and Chittagong Stock Exchange. Of which, 46 are from the insurance sector, 30 banks and 23 non-bank financial institutions.
Foreign banks and new banks are currently not listed with the stock market.
The government has also decided to increase corporate income tax for listed cigarette companies to 45 per cent from the existing 40 per cent as part of the move to discourage tobacco consumption in the country.
The tax rate for non-listed cigarette companies will remain unchanged at 45 per cent.
The tax rate for individual taxpayer will also be set at 45 per cent on individual’s income derived from tobacco business if the business is not registered as a company.
Currently, an individual taxpayer pays income tax at regular rate ranging from 10 per cent to the highest 30 per cent on any income.
The officials said the government would gradually rationalise the corporate income tax structure and bring it down to the level of individual tax rate in line with the international practice.
Corporate tax rate is significantly high in Bangladesh compared with other countries in Asia and the developed world, officials of the National Board of Revenue said.
At present, there are different rates of corporate income tax for companies. The general corporate tax is at 35 per cent for non-listed companies, 27.5 per cent for listed companies, 42.5 per cent for banks, NBFIs and insurance companies, 37.5 per cent for merchant banks, 45 per cent for cigarette companies and mobile phone operators, and 40 per cent for listed cigarette companies and telecom operators.
In the next budget proposals, there might be no change in tax rates for telecom companies and non-listed companies, the officials said.
Source: New Age
