Govt won't impose tax on share market profit

The government has approved a proposal to modify income tax laws to bring dynamism into the capital market, report agencies. The approval came from a cabinet meeting held with Prime Minister Sheikh Hasina in the chair Monday, meeting sources said. They said the cabinet endorsed a tax rebate proposal on share market profit. "From now on no tax will be imposed on share market profit," said a source close to the meeting. The cabinet asked the concerned authorities to implement the government rules prohibiting investment by public servants in the stock market considering the risk involved in it. The regular weekly meeting of the cabinet also approved 0.05 per cent tax rate deductible at source for brokerage commission of the stockbrokers instead of 0.10 per cent. Leaders of both the bourses -- Dhaka and Chittagong Stock Exchanges -- have long been demanding to reverse tax plan for stock brokers.

The government decision apparently came at a time when the country's twin bourses have been showing downtrend. The premier bourse of the country -- DSE -- suffered a massive fall Monday and lost 167.68 points or 3.33 per cent, pulling the benchmark index below 5000 (4864.30) again. The benchmark index of the DSE -- DGEN -- shed 82.50 points or 1.61 per cent on Sunday while it lost 2.06 per cent or 107.76 points on Thursday.

The continued fall in share prices forced the investors to return to the streets in Motijheel area, the first in the new year.