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June 13, 2024
Economy Tag : Vat & Tax

Trade bodies in Bangladesh’s ICT sector have urged the government to keep web hosting and cloud service companies tax-free to bolster data protection and localization. Local entrepreneurs currently hold only 10 percent of the $20 million market, and taxation could stifle their growth. This call comes as the government proposed a three-year tax exemption for 19 ICT businesses to promote cashless transactions and the digital economy, but excluded web hosting and cloud services from the exemption list for fiscal 2024-25. Ahmed, a sector representative, highlighted the importance of maintaining tax exemptions to support local ICT companies’ growth and urged the government to reconsider the 1 percent duty on imports of capital equipment for high-tech park investors, advocating for the continuation of the duty-free status.

June 13, 2024
Economy Tag : Vat & Tax

The proposed tax waivers for imports of certain raw materials in FY25 aim to benefit consumers and drug manufacturers, particularly in cancer drug production. The reduction in tax on imported APIs for Azithromycin from 15% to 5% and inclusion of six more cancer drugs on the zero-tariff list are intended to stimulate domestic production. However, challenges persist due to the high dollar-taka exchange rate, escalating production costs, and limited local manufacturing capacity for cancer drugs. While consumers may eventually benefit if the taka strengthens against the dollar, drug manufacturers emphasize the need for scaled-up production to reflect tax benefits in product prices and profits. The government has also proposed zero taxes on imports of additional raw materials to support API production. Despite initiatives like the API industrial park, infrastructure constraints hinder commercial operations. While tax incentives on medical devices may lower prices slightly, concerns remain about the extent to which these benefits will translate to consumer prices, with skepticism about manufacturers passing on savings to customers.

June 13, 2024
Economy Tag : Vat & Tax

State-owned Jamuna Fertilizer Company Ltd, despite years of profitability and substantial fixed deposit receipts (FDRs), faced unprecedented tax enforcement. Taxmen froze all its nationwide bank accounts and encashed FDRs, recovering Tk 860 million in overdue taxes from fiscal years 2013-14 to 2021-22. Similar actions in May targeted private firms Ulka Games and Tiger IT, yielding Tk 507 million and Tk 143 million in unpaid taxes, respectively. Tax Zone-15 in Dhaka handled these cases, amassing Tk 2.69 billion in undisputed tax claims. This marked the first time NBR took such stern action against a state-owned entity. Despite prior notices, Jamuna failed to settle its dues, prompting account freezes and FDR encashment. The recovery process involved encashing ten FDRs held in six bank branches. Intensive monitoring and training enabled efficient use of financial accounting software, leading to a 50% revenue increase for Tax Zone-15. Efforts also focused on expediting tax dispute settlements pending in courts, with Tk 1.55 billion already recovered.

June 13, 2024
Industry : Healthcare & Pharma

The proposed tax waivers for imports of certain raw materials in FY25 aim to benefit consumers and drug manufacturers, particularly in cancer drug production. The reduction in tax on imported APIs for Azithromycin from 15% to 5% and inclusion of six more cancer drugs on the zero-tariff list are intended to stimulate domestic production. However, challenges persist due to the high dollar-taka exchange rate, escalating production costs, and limited local manufacturing capacity for cancer drugs. While consumers may eventually benefit if the taka strengthens against the dollar, drug manufacturers emphasize the need for scaled-up production to reflect tax benefits in product prices and profits. The government has also proposed zero taxes on imports of additional raw materials to support API production. Despite initiatives like the API industrial park, infrastructure constraints hinder commercial operations. While tax incentives on medical devices may lower prices slightly, concerns remain about the extent to which these benefits will translate to consumer prices, with skepticism about manufacturers passing on savings to customers.

June 13, 2024
Industry : Fertilizer

State-owned Jamuna Fertilizer Company Ltd, despite years of profitability and substantial fixed deposit receipts (FDRs), faced unprecedented tax enforcement. Taxmen froze all its nationwide bank accounts and encashed FDRs, recovering Tk 860 million in overdue taxes from fiscal years 2013-14 to 2021-22. Similar actions in May targeted private firms Ulka Games and Tiger IT, yielding Tk 507 million and Tk 143 million in unpaid taxes, respectively. Tax Zone-15 in Dhaka handled these cases, amassing Tk 2.69 billion in undisputed tax claims. This marked the first time NBR took such stern action against a state-owned entity. Despite prior notices, Jamuna failed to settle its dues, prompting account freezes and FDR encashment. The recovery process involved encashing ten FDRs held in six bank branches. Intensive monitoring and training enabled efficient use of financial accounting software, leading to a 50% revenue increase for Tax Zone-15. Efforts also focused on expediting tax dispute settlements pending in courts, with Tk 1.55 billion already recovered.

June 13, 2024
Industry : Bank

NCC Bank and Arab National Bank (ANB) recently held a bilateral development meeting in Dhaka to discuss enhancing remittance services. The meeting focused on ensuring the safe and efficient distribution of money remitted by expatriates through NCC Bank’s extensive network and mobile remittance services. Both banks expressed a commitment to improving the remittance process, aiming to provide more secure and reliable services for their customers. Key executives from both institutions attended the meeting, underscoring the importance of this collaboration. This partnership is expected to strengthen remittance flows and benefit customers in both countries.

June 13, 2024

State-owned enterprises in Bangladesh have become significant loan defaulters. According to the Bangladesh Economic Survey 2024, eight state-owned banks now default on loans totaling Tk 184 crore. The defaulters include the Bangladesh Jute Mills Corporation (BJMC), Bangladesh Textile Mills Corporation (BTMC), Bangladesh Agricultural Development Corporation (BADC), Bangladesh Tea Board (BTB), Bangladesh Rasayan Shilpa Sangstha (BCIC), Bangladesh Food and Sugar Industries Corporation (BSFIC), Bangladesh Road Transport Corporation (BRTC), and Trading Corporation of Bangladesh (TCB). Among these, BJMC has the highest defaulted loans, amounting to Tk 131.30 crore. BTMC, BADC, and BTB have defaulted on Tk 24.9 crore, Tk 21.27 crore, and Tk 4.62 crore, respectively. The combined defaulted loans of BCIC, BSFIC, BRTC, and TCB total Tk 6 crore. Overall, the loan status of banks to 49 companies is Tk 65,089 crore. Additionally, data from Bangladesh Bank shows that default loans in the banking sector hit a record Tk 1.82 trillion at the end of March, primarily from the private sector. The Finance Division of the Ministry of Finance annually reports the default loans of government agencies in the Bangladesh Economic Survey.

June 13, 2024

NCC Bank and Arab National Bank (ANB) recently held a bilateral development meeting in Dhaka to discuss enhancing remittance services. The meeting focused on ensuring the safe and efficient distribution of money remitted by expatriates through NCC Bank’s extensive network and mobile remittance services. Both banks expressed a commitment to improving the remittance process, aiming to provide more secure and reliable services for their customers. Key executives from both institutions attended the meeting, underscoring the importance of this collaboration. This partnership is expected to strengthen remittance flows and benefit customers in both countries.

June 13, 2024

Global Islami Bank holds a ‘Double A Minus’ rating for long-term and ‘ST-2’ for short-term surveillance, certified by Alpha Credit Rating Limited. This assessment is based on the audited financial report for the fiscal year 2023 and relevant qualitative data up to June 11 of the current year.

In the first quarter of fiscal year 2024 (January-March), the bank reported an earnings per share (EPS) of 81 paise, up from 58 paise (revised) in the same period last year. As of March 31, the net asset value per share (NAVPS) stood at 14.74 paise.

For the financial year 2023, Global Islami Bank declared a dividend of 5 percent cash and 5 percent stock. The EPS for the year was Tk 1.30 paise compared to 98 paise (revised) in the previous fiscal year, while NAVPS was 13.94 paise as of December 31.

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MTB Seeks Bangladesh Bank Approval for Land Acquisition
June 13, 2024
Industry : Bank

Mutual Trust Bank (MTB)  plans to acquire three bighas (60 khata) of land in Beraid, Dhaka, for constructing its own head office. The bank has applied to Bangladesh Bank for necessary approvals. Financially, MTB reported a consolidated earnings per share (EPS) of Tk 2.91 for the fiscal year 2023, marking a 20.75% increase from the previous year's revised figure of Tk 2.41. The bank's consolidated net asset value per share (NAVPS) stood at Tk 24.52 as of December 31, 2023, up from Tk 21.70 (revalued) in the prior year. MTB distributed a 10% cash dividend for the year, continuing its dividend payout tradition.

NRBC Bank's AGM Deferred by High Court Decision
June 13, 2024
Industry : Bank

The High Court has postponed NRBC Bank's annual general meeting following a writ petition alleging irregularities. The court also instructed the Bangladesh Securities Exchange Commission (BSEC) to explain why its senior officials should not oversee the AGM to ensure transparency.

India Proposes New Freight Train Trial to Bhutan Border via BD
June 13, 2024
Industry : Logistics

India has proposed a new trial run of a freight train up to the Bhutan border via Bangladesh, sending a revised draft memorandum of understanding (MoU) through its mission in Dhaka. This initiative aims to assess the feasibility of using Indian railways for transporting Bangladeshi goods to Bhutan.

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