Despite Coronavirus pandemic, the government revenue earnings from the Dhaka Stock Exchange witnessed a rapid growth in the first half (H1) in current fiscal, up almost double over the same period of the previous fiscal.
The government has collected a bigger revenue worth about Tk 1,451 million from the DSE during the time, which was Tk727 million in the same period of the previous fiscal.
Market analysts said the government earnings from the DSE has rapidly increased as most of the investors have increased their funds in the market amid growing confidence of investors.
They said trading activities have been increased significantly during the period.
Besides, most of the share price of the DSE increased amid market-supportive measures by the Bangladesh Securities and Exchange Commission (BSEC), which also helped investors to get more earnings.
Eminent economist and market expert Prof Abu Ahmed said some market supportive initiatives by the BSEC have been rebuilt confidence among investors to inject funds more in the market.
As a result, the government revenue earnings from the DSE increased as trading volume was on the rise riding on regulatory measures, he added.
The government should immediately prepare the ground quite well to bring in some good companies, in order to undertake a drive to develop a long-term financing capital market, Ahmed added.
The eminent economist said, the government should encourage good companies, including local as well as multinational companies like Nestle to offer IPOs.
Ahmed mentioned that the government should make some rules and give incentives including reducing corporate tax for listed companies to encourage good companies to be listed in the stock market.
An analyst said the earnings are related to turnover. As a result, tax will rise if turnover increased, he added.
However, the government earned the amount on TREC (trading right entitlement certificate) holders' commission and share sales by sponsor-directors and placement holders.
The DSE, on behalf of the government, collects tax as TREC holders' commission and share sales by sponsor-directors and placement holders at the rate of 0.05 per cent and 5.0 per cent respectively and deposits the amount to the government exchequer.
Of the total earnings in July-December, 2020, Tk 1,029 million came from the TREC holders' commission, popularly known as brokerage commission, while Tk 422 million came from the share sales by sponsor-directors and placement holders, the DSE data shows.
The daily average turnover increased to Tk6.49 billion in the last year against Tk4.80 billion in 2019.
DSEX, the core index of the DSE also went up by 1,413 points or 35 percent in H1 in current fiscal year.
