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“Lack of transparency, changing taxes among reasons for stock market’s downward trend”
Economists state that the stock market is experiencing a downward trend.
Dr. Aminda Methsila, Senior Lecturer at the Faculty of Business Studies and Finance, Wayamba University speaking on the subject said:
“There has been a systemic decline in the last three to four years. The main reason for the decline in the market is the amount of transactions taking place in the stock market reducing. This translates into a decline in investors. There is a reduction in the amount of investors coming in, both local and international. All these have resulted in these market declines.
“Why is there a low attraction by foreign investors to come and invest here. Why are they not attracted to the stock market. The main reason, in my belief, is the lack of transparency and the lack of strength in the economic policies of the government. Tax is being imposed on various occasions. Those taxes are being removed as well. Then they discuss tax policies once again. In the recent past there has been no consistency when it comes to the economic policies in the country.
“At a time when the value of the dollar is reduced, it is beneficial for the foreign investors to invest here in Sri Lanka. But we are unable to see a strong mechanism to attract such foreign investors”.
The market players reiterate that issues have cropped up regarding the stock transfer levy and the capital gains tax as well.
They state that the a recent budget imposed the stock transfer levy and was thereafter removed.Market players add that there is uncertainty as to whether the capital gains tax is imposed or not.
Economic specialists state that the government is unable to attract foreign investors into the stock market due to the lack of consistency in economic policies
Economists state that the stock market is experiencing a downward trend.
Dr. Aminda Methsila, Senior Lecturer at the Faculty of Business Studies and Finance, Wayamba University speaking on the subject said:
“There has been a systemic decline in the last three to four years. The main reason for the decline in the market is the amount of transactions taking place in the stock market reducing. This translates into a decline in investors. There is a reduction in the amount of investors coming in, both local and international. All these have resulted in these market declines.
“Why is there a low attraction by foreign investors to come and invest here. Why are they not attracted to the stock market. The main reason, in my belief, is the lack of transparency and the lack of strength in the economic policies of the government. Tax is being imposed on various occasions. Those taxes are being removed as well. Then they discuss tax policies once again. In the recent past there has been no consistency when it comes to the economic policies in the country.
“At a time when the value of the dollar is reduced, it is beneficial for the foreign investors to invest here in Sri Lanka. But we are unable to see a strong mechanism to attract such foreign investors”.
The market players reiterate that issues have cropped up regarding the stock transfer levy and the capital gains tax as well.
They state that the a recent budget imposed the stock transfer levy and was thereafter removed.Market players add that there is uncertainty as to whether the capital gains tax is imposed or not.
Economic specialists state that the government is unable to attract foreign investors into the stock market due to the lack of consistency in economic policies
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