Shawdesh Desk:

The National Board of Revenue has announced a reduction in the capital gains tax on profits from the sale of shares in listed companies on Bangladesh’s stock exchanges, aiming to make the market more attractive to both domestic and foreign investors.

Under the new NBR notification, a flat 15 per cent tax rate will apply to capital gains exceeding Tk 50 lakh from trading listed shares. Previously, capital gains from shares sold within five years of purchase were taxed at the regular rate, with a maximum capital gains tax rate of 30 per cent on amounts above Tk 50 lakh.

Additionally, wealthy taxpayers will still be subject to a surcharge based on their net worth. This surcharge ranges from 10 to 35 per cent, depending on the taxpayer’s net assets.

For net assets above Tk 4 crore, 10 per cent surcharge on tax is payable; for above Tk 10 crore, 20 per cent surcharge; for above Tk 20 crore, 30 per cent surcharge; for above Tk 50 crore, 35 per cent surcharge on tax is payable.

For example, a taxpayer with net assets exceeding Tk 50 crore will face a 15 per cent tax on capital gains above Tk 50 lakh, along with a 35 per cent surcharge on this tax, resulting in a total effective rate of 20.25 per cent.

This revised tax framework, applicable from July 1, 2024, to June 30, 2025, significantly lowers the maximum effective rate for capital gains from 40.50 per cent to 20.25 per cent for eligible taxpayers. NBR officials anticipate that the streamlined tax policy will increase investment in Bangladesh’s stock market, promoting growth and liquidity.