Express (July 21, 2011)
The Bangladesh Association of Publicly Listed Companies (BAPLC) has urged the government to increase supply side in the capital market to avert any further debacle, reports UNB.
The association also urged the government to take steps so that the multinational companies can offload more shares as well as to give lower corporate tax facility to those listed companies which would offload more shares in the market.
The listed companies are currently paying corporate tax at a rate of 27.5 per cent while the non-listed companies at a rate of 37.5 per cent.
The association placed their demands when a nine-member BAPLC delegation, led by its president Salman F Rahman, called on Finance Minister AMA Muhith at his secretariat office. Muhith also launched the website of the BAPLC.
Salman F Rahman said the listed companies which would offload more shares should get lower corporate tax facility than the companies which would offload fewer shares.
He felt that the multinational companies like Marico, GP and Singer should offload more shares.
Salman Rahman said index is not the issue for the capital market. It will increase automatically if the supply of shares is ensured.
Citing the example of England, he demanded formation of a separate board as alternate investment market (AIM) for the small capital companies for their trading.
AIM is a sub-market of the London Stock Exchange, allowing smaller companies to float shares with a more flexible regulatory system than is applicable to the main market.
The BAPLC president also demanded abolishing the capital gains tax on foreign institutions to attract more investment.
In response, the finance minister said they are also trying to increase the supply side as some proposals from the private sector are under process.
He said some of the state-owned enterprises (SOEs) would start offloading their shares within a month or so though some of the companies would take a little more time. "This is the only way to keep the market energetic and stable."
Muhith informed that work for establishing seven Special Economic Zones (SEZs) would start within the next two months, but all of them could not be started at a time.
He admitted that the government had committed some mistakes including frequent change of decisions and excessive exposure of banks in the stock market that led to the share market collapse early this year.
About the stock market, the finance minister hoped that it is going to be rather stable. "The ups and downs in share market will continue for a few more days, but it will be an important player in the investment climate of Bangladesh."
He felt that the number of listed companies in the capital market should be increased as it is growing.
Muhith said the stock market should be allowed to run on its own although the country has some deficiencies like dearth of chartered financial analysts (CFAs).
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