TDS Desk:

The National Board of Revenue (NBR) 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 percent 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 percent 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 percent, depending on the taxpayer’s net assets:

– Net assets above Tk 4 crore: 10 percent surcharge on tax payable

– Above Tk 10 crore: 20 percent surcharge

– Above Tk 20 crore: 30 percent surcharge

– Above Tk 50 crore: 35 percent surcharge

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

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 percent to 20.25 percent for eligible taxpayers. NBR officials anticipate that the streamlined tax policy will increase investment in Bangladesh’s stock market, promoting growth and liquidity.