Experts for corporate tax cut to deepen capital market

Experts at a roundtable on Wednesday stressed the need for reducing corporate tax and listing companies having good fundamentals to deepen the capital market.

They also emphasised on bringing discipline in IPO (initial public offering) management and dividend declaration.

The speakers put forward the recommendation at the meeting orgnised by an association of investors in the capital.

Chittagong Stock Exchange (CSE) Chairman Dr. A. K. Abdul Momen and market experts attended the meeting.

The CSE chairman appreciated the recent growth of the capital market, but said it was not up to the mark as compared to the GDP growth.

"We should find ways so that the capital market can keep pace with the GDP growth," Mr Momen said.

Capital market expert Professor Abu Ahmed said the number of companies having good fundamentals is more important for long term investments than total number of companies listed with the stock exchanges.

"Corporate tax should be reduced further for the listed companies so that other companies get interest to go public," he said, urging the high ups in the government to bring good companies in the market.

"The regulator should impose at least three-year lock-in on the shares of sponsor-directors due to their bad practices," Professor Abu Ahmed added.

Dr. Md. Helal Uddin, a professor of economics at Dhaka University, said the market cannot be stabilised with the funds from banks.

"The market will be stable only when the companies having good fundamentals will be listed," he said. He also criticised the institutional investors due to their behaving like retail investors.

The investors' representatives demanded allocation of sufficient fund for Investment Corporation of Bangladesh (ICB) so that the capital market gets support from the ICB.

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