Non-listed telecom cos likely to see corporate tax slashed by 2.5 pc
UNB
There is something for the countrys non-listed telecom companies to cheer about as the government might slash their corporate tax by 2.5 per cent in the upcoming budget for fiscal 2015-16, aiming to boost investment in the sector, reports UNB.
Sources at the National Board of Revenue (NBR) said the government has taken the decision to rationalise the corporate tax between non-listed telecom companies and non-listed other corporate companies.
The non-listed telecom companies are currently giving 45 per cent tax, while the corporate tax for the non-listed corporate companies is 35 per cent, which was 37.5 per cent before the outgoing fiscal.
The government in the current fiscal reduced the corporate tax for the non-listed corporate companies.
Its a long-standing demand of the telecom companies as well as the trade bodies to rationalise the corporate tax of the non-listed telecom companies, a senior NBR official involved with income tax policy told UNB.
As per the directives of the finance ministry, he said, the NBR has taken the decision aiming to see more investment in this sector.
The corporate tax for the listed telecom companies is now 40 per cent while the rate is 45 per cent for the non-listed telecom companies. But, the rate for the listed telecom companies will remain unchanged, the NBR official added.
He said the corporate tax in Bangladesh is relatively high.
Although weve a plan to reduce the rate in all the sectors, the Board now
has decided to reduce the non-listed telecom companies rate considering the revenue target.
About the justification of reducing the corporate tax for the non-listed telecom companies, the NBR official said the government wants to invite more investment in the telecom sector as this sector is one of the main tools for turning the country into Digital Bangladesh.
If the telecom sector keeps improving, itll help the government a lot achieve its goal in making Digital Bangladesh, he said.
Now there are 10 telecom companies in the country and six of them are mobile phone companies and others are public switched telephone network (PSTN).
The mobile phone companies are GrammenPhone, Banglalink, Robi, Airtel, Citycell and Teletalk while the PSTN are BTCL, Ranks Telecom, BanglaPhone and World Tel.
According to the existing system, the non-listed companies will get 10 per cent tax rebate if they offload minimum 20 per cent share in the capital markets.
If a listed company declares dividend above 10 per cent but below 30 per cent, it can enjoy 24.75 per cent tax instead of 27.5 per cent.
But, if a company declares below 10 per cent dividend or no dividend or is not able to give dividend in the stipulated timeframe it has to pay 37.50 per cent corporate tax.
