Staff Reporter :
The government has finally decided to cut corporate tax rate for the banks. It was the long-standing demand of the country’s banking sector’s sponsors, sources said.
They said that the highest policy making body of the government recently okayed a proposal in this regard presented by the National Board of Revenue (NBR).
“NBR has proposed for the corporate tax cut to 40 per cent for the banking sector from the current rate of 42.5 per cent,” a senior NBR official told The New Nation on Friday on condition of anonymity.
He said that the new tax rate would come into effect during the next fiscal, beginning from July 1 this year.
“Proposal of tax cut will also be raised in the next budget for the fiscal year 2015-16 to be tabled in the Parliament on June 4,” he added.
Earlier, the country’s banking sector’s entrepreneurs at a pre-budget discussion with the Finance Minister AMA Muhith proposed to bring down the corporate tax to 35 per cent from the current level of 42.2 per cent.
“We were advocating corporate tax cut for a long time as the prevailing tax rate was high compared with other countries in the region,” Ali Reza Iftekhar, Chairman of Association of Bankers Bangladesh (ABB) told The New Nation on Friday. He added, such a high rate raised the lending rates of the banks.
“Once it comes into effect, it will help boosting profitability of the commercial banks and make some rooms to reduce the bank interest rates,” he noted.
Praising the decision of the government, Md Nurul Amin, Managing Director of Meghna Bank, said that the banks were burdened by high corporate tax.
He also said that the move will help local banks reduce interest rates and spur their lending business.
In 2013, the country’s banks reported an operating profit of Tk 18,610 crore. But their net profit came down to Tk 7,255 crore after deduction of corporate tax and required provisioning. The operating profit of the banks stood at Tk 21,265 crore in 2014. But the net profit was at Tk5,992 crore after deduction of tax and provisioning.
The government has finally decided to cut corporate tax rate for the banks. It was the long-standing demand of the country’s banking sector’s sponsors, sources said.
They said that the highest policy making body of the government recently okayed a proposal in this regard presented by the National Board of Revenue (NBR).
“NBR has proposed for the corporate tax cut to 40 per cent for the banking sector from the current rate of 42.5 per cent,” a senior NBR official told The New Nation on Friday on condition of anonymity.
He said that the new tax rate would come into effect during the next fiscal, beginning from July 1 this year.
“Proposal of tax cut will also be raised in the next budget for the fiscal year 2015-16 to be tabled in the Parliament on June 4,” he added.
Earlier, the country’s banking sector’s entrepreneurs at a pre-budget discussion with the Finance Minister AMA Muhith proposed to bring down the corporate tax to 35 per cent from the current level of 42.2 per cent.
“We were advocating corporate tax cut for a long time as the prevailing tax rate was high compared with other countries in the region,” Ali Reza Iftekhar, Chairman of Association of Bankers Bangladesh (ABB) told The New Nation on Friday. He added, such a high rate raised the lending rates of the banks.
“Once it comes into effect, it will help boosting profitability of the commercial banks and make some rooms to reduce the bank interest rates,” he noted.
Praising the decision of the government, Md Nurul Amin, Managing Director of Meghna Bank, said that the banks were burdened by high corporate tax.
He also said that the move will help local banks reduce interest rates and spur their lending business.
In 2013, the country’s banks reported an operating profit of Tk 18,610 crore. But their net profit came down to Tk 7,255 crore after deduction of corporate tax and required provisioning. The operating profit of the banks stood at Tk 21,265 crore in 2014. But the net profit was at Tk5,992 crore after deduction of tax and provisioning.
