NBR tells banks to slash interest on loans

Banks will not get corporate tax benefits in the proposed budget if they do not lower interest rates on loans for businesses, said the chief of tax administrator.

“Banks are fortunate because the corporate tax has been reduced. But if the lending rate is not right, they will not get the tax benefits," said Md Mosharraf Hossain Bhuiyan at a news conference of the Metropolitan Chamber of Commerce and Industry (MCCI) on Thursday.

The National Board of Revenue chairman, however, did not clarify how the government would adjust the corporate tax and lending rates of the banks if they did not cut the lending rates.

He noted that the owners’ organisation Bangladesh Association of Banks announced capping lending rates at 9.0 per cent on Wednesday, according to bdnews24.com.

The MCCI organised the media conference to react to the Tk 4.64 trillion budget proposed by Finance Minister AMA Muhith for 2018-19 fiscal year.   

In the budget, Muhith proposed to lower corporate tax for banks, insurance firms and financial institutions listed on the capital market to 37.5 per cent from 40 per cent. The proposed cut for non-listed banks, insurance firms and financial institutions is to 40 per cent from 42.5 per cent.

Different quarters have criticised Muhith for proposing the cuts in corporate rates for banks before ‘resolving the issues besetting the sector’.