Finance Minister Amir Khasru Mahmud Chowdhury has announced a package of tax incentives and policy measures aimed at attracting more investment to Bangladesh’s capital market, including lower taxes on dividend income, tax exemptions for zero-coupon bonds, and enhanced incentives for listed companies.

The announcements came during his winding-up speech on the proposed national budget for the 2026-27 fiscal year in Parliament on Monday, chaired by Speaker Hafiz Uddin Ahmed. The finance minister also proposed several amendments to the Finance Bill to promote sustainable development of the capital market and encourage long-term fundraising.

Among the key measures, the government proposed making income from zero-coupon bonds fully tax-exempt to encourage investment in long-term financial instruments.

To encourage more companies to list on the stock market, the minister proposed a 2.5 percentage-point reduction in corporate tax for companies that become publicly listed through share transfers. An additional 2.5 percentage-point tax cut has been proposed for companies that float at least 10 percent of their shares through an initial public offering (IPO), direct listing, rights issue, or repeat public offering.

The finance minister also announced an extra 2.5 percentage-point tax benefit for both listed and unlisted companies that conduct all financial transactions through banking channels, a move aimed at promoting greater transparency and digital financial transactions.

Under the proposed framework, listed companies that complete all transactions through banks and offload at least 10 percent of their shares to the public would enjoy a tax rate 7.5 percentage points lower than comparable unlisted companies.

To make stock market investment more attractive, the government proposed reducing the tax on dividend income to 20 percent for corporate taxpayers and 15 percent for individual investors.

The finance minister further proposed removing the existing Tk 500,000 investment ceiling for tax rebates on investments in mutual funds, allowing investors to claim tax benefits regardless of the amount invested.

He said the government’s objective is to encourage fundamentally strong and promising companies to enter the stock market to ensure a steady supply of long-term capital for industrialisation and investment. He expressed hope that the incentives would attract more quality companies to the bourse and strengthen the capital market.

The minister also said investor confidence has begun to recover, as reflected in the recent upward trend in stock market indices, adding that ongoing capital market reforms would continue.

Referring to Bangladesh’s engagement with the International Monetary Fund (IMF), Chowdhury rejected claims that the government had returned empty-handed from discussions with the lender.

He said the current government had voluntarily withdrawn from the previous IMF programme because some of its conditions were considered inconsistent with the country’s national interest. However, discussions with the IMF are continuing, and a new programme will be negotiated while safeguarding Bangladesh’s economic priorities, he added.