The government's revenue earnings from the prime bourse marked a whopping 101 per cent rise in the first eight months of the current fiscal year (FY) compared to the same period of the previous fiscal amid rising trading volume.
Market insiders said on the back of the rising trading volume, the government earnings from the Dhaka Stock Exchange (DSE) rose accordingly, as earning is related to turnover.
The market turnover and index marked rise during the period under review amid growing confidence of investors riding on regulatory measures to bring disciple in the market, said a top broker.
The government bagged tax worth Tk 1,998 million in the July-February period of FY 2020-21 as against Tk 994 million in the same period in the previous fiscal year, climbing by 101 per cent, according to statistics from the DSE.
The government earned the amount on TREC (trading right entitlement certificate) holders' commission and share sales by sponsor-directors and placement holders.
However, the government earnings from the DSE tumbled 60 per cent month-on-month in February due to less trading sessions and sluggish activities during the month compared to January.
The government bagged revenue worth about Tk 157 million in February, which was Tk 390 million a month earlier in January, the DSE data showed.
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.
A DSE official said the government earnings from the prime bourse jumped as trading volume increased substantially in the July-February period of the FY 2020-21, which helped higher tax collection.
"The earnings are related to turnover. It's usual that tax will rise if turnover increased," he said.
The daily average turnover on the DSE soared to more than Tk 9.0 billion on an average in the July-February period of the current fiscal year.
DSEX, the prime index of the DSE, also surged 1,415 points or 35 per cent in the first eight months of the current fiscal year (July 1 to February 28), the DSE data showed.
However, the government's revenue earnings from the DSE hit more than 10 years low to Tk 1.04 billion in the last FY 2019-20 due to bearish market trend and suspension of trading activities for more than two months due to Covid-19 outbreak.
The DSE paid tax worth Tk 2.72 billion in FY 2011-12, Tk 1.27 billion in FY 2012-13, Tk 1.54 billion in FY 2013-14, Tk 1.74 billion in FY 2014-15, Tk 1.58 billion in FY 2015-16, Tk 2.46 billion in FY 2016-17, Tk 2.33 billion in FY 2017-18 and Tk 2.51 billion in FY 2018-2019 on TREC holders' commission and share sales by sponsor-directors and placement holders.
However, the DSE paid tax worth Tk 4.47 billion in the FY 2010- 11, the highest in its history, when the market witnessed a wild trend before crashing.