Bourses may get exemptions from double taxation

FE Report | Published: January 21, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) have been assured to get tax exemption from their own profits for a certain period along with another rebate from capital gain tax against the members' shares in exchanges, officials said.
The officials of both the exchanges disclosed this Monday after holding a meeting with the top officials of National Board of Revenue (NBR).
The meeting chaired by the member (Tax Policy) of the NBR SM Aminul Karim was attended by the chief executive officer (CEO) of Dhaka Stock Exchange (DSE) Dr. Swapan Kumar Bala and the managing director of Chittagong Stock Exchange (CSE) Syed Sajid Husain.
"At the meeting the NBR officials verbally confirmed us that tax exemption will be ensured against the exchanges' own profits. Another exemption from the capital gain tax will also be ensured against the members' stakes in exchanges and trading right certificate," said, the CSE managing director Mr. Sajid.
The DSE members have initially received 40 per cent or 721.5 million shares of the bourse as per the demutualisation scheme and the remaining 60 per cent or 1082.2 million shares have been kept in a 'block account' to be floated in the initial public offering.
The CSE members have also been allocated 40 per stakes of the port city bourse and the remaining 60 per cent stakes have been kept in block account.
The DSE and CSE have sought rebate once from the capital gain tax against the shares of the exchanges initially issued among the members on a ground that the capital gain taxes normally are not imposed on unrealized gains.
"The NBR officials have said that the capital gain tax might be charged when the remaining 60 per cent shares will be offloaded," the meeting participants said.
The NBR is yet to specify the period of the proposed tax holiday against the exchanges' own profits.
The DSE and the CSE have sought tax exemption for five years and seven years respectively.
"The revenue board will specify the tenure of the tax exemption on the exchanges own profits in an SRO during the budget period," Mr. Sajid said.
"As per the existing facility, the bourses are not required to pay tax on their income. But we want a clear solution to tax exemption on exchanges' own profits. That's why the revenue board has agreed to ensure proposed exemption while formulating the next budget considering our proposal," said Mr. Sajid.