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Tax receipts from DSE dip 57 per cent in August

Lower trading session, poor turnover affect earnings


FE Report | Published: September 03, 2019 10:54:23 | Updated: September 04, 2019 10:57:59


The government's revenue earnings from the Dhaka Stock Exchange (DSE) slumped 57 per cent month-on-month in August due to lower trading sessions on the occasion of Eid-ul-Azha holiday.

Market analysts said low share sales by the sponsor-directors coupled with lower trading sessions due to Eid-ul-Azha vacation, affected the government earnings from the prime bourse.

The prime bourse witnessed only 16 trading sessions in August as the market closed nine days from August 9 to August 17 on the occasion of Eid-ul-Azha, including weekly holidays.

The government bagged revenue worth Tk 83 million in August, the second month of the current fiscal year, against Tk 195 million in July, registering a decline of 57 per cent month-on-month, the DSE data showed.

Of the total earnings in August, Tk 74 million came from the TREC (trading right entitlement certificate) holders' commission, popularly known as brokerage commission.

And the government earned only Tk 9 million from share sales by sponsor-directors and placement holders in August against Tk 105 million in July, which impacted overall earnings.

A leading broker said it was the lowest earnings from the sponsor-directors and placement holders share sale in recent months.

The DSE, on behalf of the government, collects the tax as TREC holders' commission at a rate of 0.05 per cent and from sponsor-directors' and placement holders' shares sales at a rate of 5.0 per cent. The DSE then deposits the amount to the public exchequer.

The daily turnover, the important gauge, stood at Tk 4.62 billion on average in August 2019, up 20 per cent over the previous month. In July, 2019, daily average turnover was Tk 3.83 billion.

DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), also lost 43 points or 0.83 per cent during the August.

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 fiscal year 2010-11, the highest in its history, when the market witnessed a wild trend before crashing.

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