Finance minister did not have anything special for share market
Abu Ahmed, Professor of Economics Department, Dhaka University : Finance minister gave nothing to the share market. The proposed budget for the fiscal years 2018-19 is nothing but frustrating for the ordinary investors of the stock market. The minister also did not give importance to the share market, who had once said he might make the stock market much stronger, whose focal point would be the attraction of sourcing long-term investment. We hoped that he might have cut the corporate income tax, so promising and established companies show interest to engage in the share market. But we don’t see it there.
If the big companies were exempted of at least 2% taxes, they might have invested, only to tap into the opportunity. The country’s stock market saw a 700-point fall in the last few months. The finance minister must have adjusted the debacle the stock market has been facing. Measures must have been taken to address the problem prevailing in the share market.
He has earlier said corporate income tax is excessive. But the proposed budget did not reflect anything aimed at fixing the issue. Banking companies have been given a 2.5% exemption; those who are lobbyist are probably benefitting from the situation. But there are other companies and investors, especially hundreds of thousands of investors. But nobody thought about them. Things appear to be how they were in the past. The stock market remained neglected, which is so unfortunate. I want to ask the minister a question: have you ever thought of how better companies can be brought to stock market without a tax cut?
I appreciate the 2.5% corporate tax curtail on the banking sector? However, the sector is indulged in loan default. They do not have the eligibility of provisioning now. The tax concession might push up the scope for provisioning a bit, but the investors will not benefit from it. Hence, they will naturally tend to approach for savings instrument. The government is bearing a massive burden of interest, which is not an ideal economic management. The government must have focused on how to bring more investors to the stock market. The queues of people buying savings certificates will get even longer than those seen last year.
Based on an interview by Mahbubul Islam, translated by Sayeed Muhammad