VC firms want tax on fund managers scrapped

Budget reaction

Venture capital (VC) firms yesterday urged the government to provide tax relief to the managers of the alternative investment funds.
Lauding the government’s latest budgetary measures to remove the tax on alternative investment funds, they said the removal of the tax on the fund managers would impart the necessary impetus to the VCs to enable them to flourish.
Officials of VC firms were speaking during a post-budget press conference at KIB Auditorium, organised by the Venture Capital and Private Equity Association (VCPEAB), a newly-launched platform which has brought all the venture capital firms of the country under a single umbrella.
Speaking on the occasion, Shawkat Hossain, secretary-general of VCPEAB and managing director of BD Venture Ltd, said before the proposed budget of 2017–18, the VC firms of the country needed to pay triple tax—on the fund, on the fund manager and on the company in which it invests.
“I thank the government for removing the tax on the fund in this year’s budget. But the VCs of the country are still burdened with double taxation. I urge the government to remove the corporate tax on the fund managers,” he said.
Speaking on the occasion, VCPEAB chairman Shamim Ahsan said a number of problems is afflicting VCs in Bangladesh.
“There are no regulations to secure the investments of VC firms. New businesses generally do not have property, equipment, or collateral to secure their investments. The high risk of investment thereby deters the establishment and active participation of venture capitalists.”
Also, as Shamim pointed out, a communication gap between venture capitalists and entrepreneurs still exists, which needs to be effectively bridged.
Shamim added that venture capital financing is very risky. As this is a new financial sector, there are many doubts among investors. 
The VCPEAB chairman said it takes at least seven to eight years to get the invested money back. It is very difficult for the VC firms to survive in this period, and so, these firms should be given a tax waiver for a period of 10 years.
“We believe this tax holiday will be a great help from the government while building Digital Bangladesh for national development.”
Shahidul Islam, chief executive officer of VIPB and treasurer of VCPEAB, and Wali-ul-Maruf Matin, co-founder and managing director of Maslin Capital, were also present at the press conference.

VC firms want tax on fund managers scrapped

Budget reaction

Venture capital (VC) firms yesterday urged the government to provide tax relief to the managers of the alternative investment funds. Lauding the governments latest budgetary measures to remove the tax on alternative investment funds, they said the removal of the tax on the fund managers would impart the necessary impetus to the VCs to enable them to flourish. Officials of VC firms were speaking during a post-budget press conference at KIB Auditorium, organised by the Venture Capital and Private Equity Association (VCPEAB), a newly-launched platform which has brought all the venture capital firms of the country under a single umbrella. Speaking on the occasion, Shawkat Hossain, secretary-general of VCPEAB and managing director of BD Venture Ltd, said before the proposed budget of 201718, the VC firms of the country needed to pay triple taxon the fund, on the fund manager and on the company in which it invests. I thank the government for removing the tax on the fund in this years budget. But the VCs of the country are still burdened with double taxation. I urge the government to remove the corporate tax on the fund managers, he said. Speaking on the occasion, VCPEAB chairman Shamim Ahsan said a number of problems is afflicting VCs in Bangladesh. There are no regulations to secure the investments of VC firms. New businesses generally do not have property, equipment, or collateral to secure their investments. The high risk of investment thereby deters the establishment and active participation of venture capitalists. Also, as Shamim pointed out, a communication gap between venture capitalists and entrepreneurs still exists, which needs to be effectively bridged. Shamim added that venture capital financing is very risky. As this is a new financial sector, there are many doubts among investors. The VCPEAB chairman said it takes at least seven to eight years to get the invested money back. It is very difficult for the VC firms to survive in this period, and so, these firms should be given a tax waiver for a period of 10 years. We believe this tax holiday will be a great help from the government while building Digital Bangladesh for national development. Shahidul Islam, chief executive officer of VIPB and treasurer of VCPEAB, and Wali-ul-Maruf Matin, co-founder and managing director of Maslin Capital, were also present at the press conference.