Finance Minister AHM Mustafa Kamal has recommended an array of cuts to the current corporate tax rates in the proposed budget for fiscal 2021-22.
In an effort to boost the ratio of private investment to GDP and ‘to pave the way for the rapid growth of trade and commerce’, Kamal proposed a reduction of tax for non-listed companies to 30 per cent from 32.5 per cent and the rate for listed companies to 22.5 per cent from 25 per cent for FY22, reports bdnews24.com.
“The present ratio of private investment to GDP stands at 23 per cent. The government has taken initiatives to improve this ratio. Reduction in corporate tax rate is expected to facilitate achieving the target for private investment to GDP ratio,” Kamal said.
“In line with the ongoing trend of globalisation and in light of the ongoing COVID-19 situation, revisiting the existing tax rate in Bangladesh is a demand of the time.
“A competitive tax rate coupled with the prevailing business-friendly environment will make a significant contribution towards the expansion of trade and commerce and industrialization in the country.”
The current 32.5 per cent tax rate was also applicable for One Person Companies or OPCs, Kamal pointed out.
With an aim to ‘formalise the economy and to encourage formation’ of One Person Companies’, Kamal suggested bringing down the tax rate for the OPCs to 25 per cent.