The securities regulator will suggest a 15-per cent gap in corporate tax between listed and non-listed companies in the next budget to attract more companies to the capital market.
Bangladesh Securities and Exchange Commission (BSEC) chairman Prof Shibli Rubayat Ul said this during a press briefing on the BSEC premises on Tuesday.
The briefing was part of a BSEC roadshow in Dubai on February 09 on Bangladesh's capital market.
"We're trying for a 15-per cent corporate tax gap for listed and non-listed companies in the upcoming budget. We'll place a proposal to this end," said Prof Islam.
Previously, there was a 10-per cent corporate tax gap as non-listed companies paid 35-per cent tax against 25 per cent paid by listed companies.
After the 2020-21 fiscal budget, the gap fell to 7.50 per cent as the government reduced tax by 2.5 per cent to 32.50 per cent for non-listed companies.
Experts criticised the decision as the non-listed companies would not be interested in going public amid the tax benefit offered for them.
"Corporate tax gap will have to be increased to encourage the listing of the MNCs that lose interest to go public following a reduction in tax gap," mentioned Prof Islam.
He said the cost of compliances will increase by 2.0-3.0 per cent for multi-national companies (MNCs) if they are listed with stock exchanges.
"…Besides, they don't need the funds that have to be raised from the market. That's why, tax incentives should be offered for the listing of the MNCs."
The BSEC chief further said that multinationals will be interested in going public if a 15-per cent corporate tax gap is ensured.
Three banks are in the pipeline of going public following a regulatory move to add a further fillip to the capital market, he disclosed.
South Bangla Agriculture and Commerce Bank has already submitted its IPO (initial public offering) proposal while two others will submit soon.
On the Dubai roadshow, Prof Islam said the securities regulator will hold similar shows in different countries targeting their financial districts.
"We'll hold roadshows in London, Rome, Toronto, New York, Hong Kong, Singapore, Sanghai, Tokyo and Malaysia to attract foreign investors and non-resident Bangladeshis," he said.
An investment bank of Switzerland, Credit Switch, will also hold a roadshow with its own fund.
BSEC executive director Md Mahbubul Alam and its spokesperson Mohammad Rezaul Karim also addressed the briefing.
The securities regulator will hold a four-day roadshow styled 'The Rise of Bengal Tiger: Potential of Bangladesh Capital Market in Dubai'.
The programme will open on February 09 and conclude on February 12 at Park Hyatt Dubai.
At the show, two summits on the Bangladesh capital market, and bilateral and multilateral meetings will also be held.
Besides, the regulator will hold two other programmes to uphold new investment opportunity and the scope for private equity and venture capital investment here.
