The Chittagong Stock Exchange (CSE) has welcomed the proposed budget incentives aimed at encouraging investment and the listing of new companies, including reduced corporate tax rates for listed firms.

In a press release issued on Tuesday, CSE noted that the budget proposes three direct measures to boost the capital market: increasing the tax gap between listed and unlisted companies from 5 percent  to 7.5, and reducing the corporate tax rate for merchant banks to 27.5 percent.

In his budget speech, Finance Adviser Dr Salehuddin Ahmed also proposed a cut in advance tax at source on capital market transactions, from 0.05 percent to 0.03.

CSE believes these incentives will help attract quality companies to the capital market and ease the tax burden on market-related institutions, including brokerage houses. The proposed measures are expected to restore dynamism in the market, according to the CSE’s post-budget statement.

Although there is no direct new incentive for general investors, the National Board of Revenue has retained full tax exemption on capital gains up to Tk5 million for individual investors, with a reduced 15% tax on gains exceeding that amount.

Additionally, the Bangladesh Securities and Exchange Commission (BSEC) recently reduced the annual maintenance fee on BO accounts by 75 percent and mandated that 25 percent of interest earned on customer accounts be deposited into the Investors Protection Fund for the benefit of affected investors.

According to the CSE, these policies are expected to significantly contribute to the sustainable development of the capital market.