Tuesday, September 25, 2018 | ePaper

Corporate tax cut to cause Tk 800cr revenue loss

  • Print
Special Correspondent  :
The government would get Tk 800 crore less in revenue due to deduction of corporate tax for publicly and non-publicly traded banks, insurance companies and financial institutions (FIs), officials said.
It came up with the move following demands from sponsors of the private banks.
"The government has offered the tax cut to facilitate the banks to bring down the interest rates to single digit," a senior official at the National Board of Revenue NBR told The New Nation yesterday.
According to an estimate, he said, the NBR would incur a revenue loss of Tk 800 crore in the next fiscal due to the corporate tax deduction.
While presenting the national budget for fiscal 2018-19, finance minister AMA Muhith proposed to reduce corporate tax to 37.50 per cent from existing 40 per cent for the listed banks, insurance companies and FIs.
He also proposed 40 per cent corporate tax for non-publicly traded banks, insurance companies and financial institutions, reducing from the existing rate of 42.50 per cent.
Welcoming the government move, bankers said that it would leave a good impact on the banks' profitability.
"It may not help much to bring down the lending rates on bank loans. It largely depends on reduction on deposit rates," said Chairman of the Association of Bankers, Bangladesh (ABB) Syed Mahbubur Rahman.
He, however, said the reduction will increase the profitability of banks. The shareholders will also get the benefit from the profit.   Opposing the government move, former Bangladesh Bank (BB) governor Dr Salehuddin Ahmed said, it can no way to help increase the banks' liquidity or reduce the interest rates and neither benefit the borrowers nor the depositors. It will largely benefit the bank directors and shareholders.  
"It's noting but a pervasive incentive for banks and I personally oppose the government's move. The government has provided the incentive bowing down to pressure of a powerful business syndicate," he added.
Dr Salehuddin Ahmed, however, urged the government to restore good governance and discipline in the banking sector to boost investors' confidence as well as private sector investment.

More News For this Category

Govt corruption in high places is always syndicated

Transparency International Bangladesh in a survey report revealed that syndicates of corrupt government employees and transport union leaders have been shoddily hampering the export and import businesses at the

Dhaka-Delhi trade deficit balloons

Kazi Zahidul Hasan  :Bangladesh's trade deficit with India marked an incremental rise year-on-year even if both the countries are enjoying excellent bilateral trade and economic relations. Business leaders attributed the

A covered van overturned due to reckless driving near Kuril Flyover on Monday injuring the driver and his helper.

A covered van overturned due to reckless driving near Kuril Flyover on Monday injuring the driver and his helper.

Alliance with corrupts to fight corruption: PM

UNB, New York :Mentioning that BNP Chairperson Khaleda Zia and her son Tarique Rahman are convicted in graft cases, Prime Minister Sheikh Hasina on Sunday said Jukto Front leaders Dr

FFs' children demand not to scrap quota for them

DU Correspondent :The freedom fighters' (FFs) children have demanded of the government not to scrap quota for them in class-I and class-II jobs in public services.They came up with the

UN has no right to interfere in Myanmar's internal matters

UN has no right to interfere in Myanmar's internal matters

AFP :Myanmar's powerful army chief says the United Nations has no right to interfere in his country's sovereignty, a week after UN investigators called for him and other top generals

ACC chief embarassed over questioning on ex-CJ SK Sinha

Anti-Corruption Commission Chairman Iqbal Mahmood says he is embarrassed to answer questions from the media regarding allegations of corruption against former Chief Justice Surendra Kumar Sinha.Sinha, who resigned from his

Hilsa production target 5 lakh MT

Hilsa production target 5 lakh MT

Special Correspondent :Hilsa fish production in the country will exceed last year's total quantity of 5 lakh metric tonnes this year, the Ministry of Fisheries and Livestock said on Monday.

Female AL leader killed as scarf gets tangled with motorbike wheel

UNB, Sylhet :A female leader of Awami League was killed on Sunday night as her scarf got tangled with the wheel of a motorcycle near Koitak Bridge area in Chatak

Trump at UN, to again confront NKorea's N-threat

AP, Bridgewater :As he begins the sequel to his stormy UN debut, President Donald Trump will again confront the dangers posed by North Korea's nuclear threat, though its shadow may