The individual stock investors have been exempted from the proposed capital gain tax as the parliament passed the Finance Bill 2014 yesterday.
The tax-free dividend income ceiling has also been increased to Tk20,000 from the proposed Tk15,000, increasing from existing Tk10,000.
The bill was passed in presence of opposition Jatiya Party with some other changes in tax and customs duties.
Stakeholders have been demanding the withdrawal of the gain tax since Finance Minister AMA Muhith placed the FY15 budget in parliament on June 5.
Muhith told the house that Prime Minister Sheikh Hasina recommended not to imposing the gain tax to help improve the stock market and encourage more investments by individuals.
“Considering the prime minister’s recommendation as an instruction, I am requesting the parliament to keep the investors’ capital gain fully exempted from paying any taxes,” he said.
The proposed budget had earlier recommended the government to incorporate capital gain tax on individual investors for the first time at a rate of 3% for Tk10 lakh while 5% for capital gain over Tk20 lakh, which sparked huge criticism from different quarters.
Other major changes from the proposals included continuation of legalising undisclosed money, withdrawal of the proposed 5% Advanced Income Tax (AIT) from mobile handsets import, and imposition of 1% surcharge on mobile handset imports etc.
Tax on flats or buildings:
The government has finalised imposing tax on flats, buildings or structures at a rate of Tk600 per square meter instead of the proposed Tk90 per square feet.
According to the proposed budget placed in parliament on June 5, the government proposed new tax rates for transferring of land, any structure, building, flat, apartment or floor space on the land at the rate of Tk90 per square feet.
The other changes in the bill are rice bran oil producing industries while Cineplex would enjoy tax holiday facility until 2019 if established in any city corporation area or in the divisional headquarters excepting Dhaka and Chittagong, withdrawal of cost and management accountants (CMAs) from the list of the tax-payer examiners and withdrawal of 5% advance income tax on mobile handset import.