The government decision to reduce corporate tax for fourth generation new nine banks irked banking experts as they said the decision will create disparity between the non-listed banks and the nine ones.
The new banks are Midland Bank, NRB Bank, NRB Commercial Bank, NRB Global Bank, The Farmers Bank, Meghna Bank, Modhumoti Bank, South Bangla Agriculture and Commerce Bank and Union Bank.
On June 4, the government reduced the corporate tax rate for listed banks to 40% from the existing 42.5%.
Finance Minister AMA Muhith, however, on June 29, provided the same benefit for the emerging banks during the passage of finance bill 2015.
The banks, commonly known to be politically-considered, were approved in 2013. The owners of the banks are all politicos, either from the ruling party or from its alliance.
Despite not being listed with the stock exchange, they are enjoying the tax rebate like the listed ones, insurance and non-banking financial institutions.
As per the Bangladesh Bank rules, the new banks will not be allowed to be listed with the stock market till 2016, but the government has provided the special benefit only because of political considerations, experts said.
Currently, 30 listed commercial banks, 23 non-banking financial institutions and 46 insurance companies are listed in the capital market, according to the stock market data.
In his concluding budget speech, the finance minister said the banks would be listed when they would complete their three-year operation since their inception.
Former finance adviser to the caretaker government, Mirza Azizul Islam, told the Dhaka Tribune the corporate tax cut to nine new banks will create disparity.
The government should not have taken such decision of giving special benefit to them, he said.
Bangladesh Bank former deputy governor Khondkar Ibrahim Khaled said the regular rule was not applied to the new financial institutions while making the tax reduction.
“All these banks have got approval in this government tenure and they have influence,” he said.
The another reason could be to bring all the banks together in one phase as all the other banks have already been listed, added the former banker.