The government revenue earnings from the Dhaka Stock Exchange (DSE) dipped 29 per cent month-on-month in February in lockstep with falling turnover.
The government collected revenue worth Tk 232 million in February which was Tk 326 million in January, 2019, according to statistics from the prime bourse of the country.
Market analysts said bearish market trend, lower shares sale by sponsor-directors coupled with reduced trading sessions affected the government earnings from the main bourse in February.
The investors mostly followed "go-slow" strategy throughout the month amid persistent liquidity shortage which diluted the government earnings as earnings are related to turnover, said a leading broker.
DSEX, the prime index of DSE, fell 110 points or 1.89 per cent in February to close the month at 5,711, after gaining 436 points in January, 2019.
The daily average turnover on the DSE came down to Tk 7.65 billion in February, which was Tk 9.72 billion in January, 2019, the DSE data shows.
The government earnings from the DSE in eight months (July to February) of the current fiscal year also fell 6.17 per cent to Tk 1626 million which was Tk 1733 million in the corresponding period of the previous fiscal, the DSE data shows.
The government earned the amount on TREC (trading right entitlement certificate) holders' commission and share sales by sponsor-directors and placement holders.
The DSE, on behalf of the government, collects tax as TREC holders' commission and share sales by sponsor-directors and placement holders at the rate of 0.05 per cent and 5.0 per cent respectively and deposits the amount to the government exchequer.
A DSE official said the government earnings fell in February on the back of falling turnover value and lower trading session.
"The earnings are related to turnover. It's usual that tax will fall if turnover decline," he said.
There were only 18 trading sessions took place in February where January saw 23 trading sessions.
The DSE paid tax worth Tk 2.72 billion in FY 2011-12, Tk 1.27 billion in FY 2012-13, Tk 1.54 billion in FY 2013-14, Tk 1.74 billion in FY 2014-15, Tk 1.58 billion in FY 2015-16, Tk 2.46 billion in FY 2016-17 and Tk 2.33 billion in FY 2017-18 on TREC holders' commission and share sales by sponsor-directors and placement holders.
However, the DSE paid tax worth Tk 4.47 billion in the fiscal year 2010-11, the highest in its history, when the market witnessed a wild trend before crashing.
