Tax receipts from DSE drop 16pc in Oct
Govt earnings from prime bourse slump 29pc in July-Oct
BABUL BARMAN | Saturday, 5 November 2022
The government's revenue earnings from the Dhaka Stock Exchange (DSE) slumped 16 per cent month-on-month in October on the back of falling turnover value.
Market analysts said the turnover fell sharply as technical glitches interrupted trading twice last month.
The technical glitches forced the authorities to reduce the trading time by three hours on October 24, resulting in a turnover of only Tk 3.35 billion on the DSE. A similar incident on October 30 kept the trading halted for one hour.
The government bagged revenue of about Tk 342 million in October as against Tk 408 million in September, according to the DSE data.
In the first four months of fiscal year (FY) 2022-23, the government's revenue earnings from DSE tumbled 29 per cent to Tk 1,223 million from Tk 1,718 million in the same period of the previous fiscal, the DSE data show.
The government earned the amount based on TREC (trading right entitlement certificate) holders' commission and share sales by sponsor-directors and placement holders.
The DSE, on behalf of the government, collects tax from TREC holders and sponsor-directors and placement holders at the rate of 0.05 per cent and 5.0 per cent respectively and deposits the amount to the government exchequer.
Of the total earnings in July-October of the current fiscal year, Tk 959 million came as tax from the TREC holders' commission, popularly known as brokerage commission, and Tk 264 million from share sales by sponsor-directors and placement holders.
In October, the daily average turnover on the DSE plunged 32 per cent, down from Tk 15.53 billion last month.
DSEX, the prime index of the DSE, also slumped 206 points or 3.16 per cent in October, compared to the previous month.
The government earnings from the prime bourse fell as trading activities remained subdued during the period, said a DSE official.
"The earnings are related to turnover. It's usual that tax will fall if turnover declined," he said, adding that as the turnover dropped during the period under review, so did
the tax.
Investors were not confident enough to inject fresh funds into stocks amid a dismal market outlook, which leads to lower turnover, said a merchant banker, requesting anonymity.