The government moves to impose 15 percent tax on stock dividends for the new fiscal year.
In his budget speech presented in parliament on Thursday, Finance Minister AHM Mustafa Kamal said: “We observed that the companies are generally distributing stock dividends instead of cash dividends. As a result, investors are deprived of their well-deserved return.”
In order to encourage the distribution of cash dividend, he said, “I propose imposition of 15 percent tax on stock dividend distributed to the shareholders by any listed company.”
He said investors expect cash dividends from their investment in the shares of a company. From that point of view cash dividend play an important role in increasing the value of the share and also strengthening the share market, he added.
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