Home
Register
Feb 26, 2016 (LBO)
Sri Lanka’s government should not impose a capital gains tax on the stock market as the market still runs on low trade volumes, Group CEO of Candor Group, Ravi Abeysuriya said.
Capital gains are profits realized on a sale of a non-inventory asset that was purchased at a cost that was lower than the amount realized on the sale.
The most common capital gains are realized from the sale of stocks, bonds, precious metals and property.
Prime Minister Ranil Wickremesinghe recently hinted that the government would move away from a subsidy regime to a capital empowerment regime through taxing capital.
Prime Minister pointed out that he would change the tax system which is currently acquire more tax from the ordinary people and charge less from the capitalists.
Wickremesinghe however did not clarify whether this would specifically apply to the stock market.
Abeysuriya said a possible imposition of tax on capital gains of stocks will also include capital losses where people will start to claim these losses wiping out the stock market risk factor.
“There is empirical evidence in countries where capital gains tax was brought into the stock market,” he said.
“In March 2012 one country brought in capital gains tax and the market trading volumes came down by 36.5 percent.”
“So unlike in the US, you can kill the market by bringing in capital gains tax to markets with low trade volumes.”
Abeysuriya suggested that it is better to keep the share transactions levy (STL) rather than imposing a capital gains tax for stock markets.
STL is purely based on the transactions taking place in the stock exchange, revenue generated under this fluctuates in accordance with the volume of the share market dealings.
Sri Lanka however removed this levy for all transactions on equity from 01 January 2016 in line with a budget proposal aimed at encouraging share market trading.
Sri Lanka’s government should not impose a capital gains tax on the stock market as the market still runs on low trade volumes, Group CEO of Candor Group, Ravi Abeysuriya said.
Capital gains are profits realized on a sale of a non-inventory asset that was purchased at a cost that was lower than the amount realized on the sale.
The most common capital gains are realized from the sale of stocks, bonds, precious metals and property.
Prime Minister Ranil Wickremesinghe recently hinted that the government would move away from a subsidy regime to a capital empowerment regime through taxing capital.
Prime Minister pointed out that he would change the tax system which is currently acquire more tax from the ordinary people and charge less from the capitalists.
Wickremesinghe however did not clarify whether this would specifically apply to the stock market.
Abeysuriya said a possible imposition of tax on capital gains of stocks will also include capital losses where people will start to claim these losses wiping out the stock market risk factor.
“There is empirical evidence in countries where capital gains tax was brought into the stock market,” he said.
“In March 2012 one country brought in capital gains tax and the market trading volumes came down by 36.5 percent.”
“So unlike in the US, you can kill the market by bringing in capital gains tax to markets with low trade volumes.”
Abeysuriya suggested that it is better to keep the share transactions levy (STL) rather than imposing a capital gains tax for stock markets.
STL is purely based on the transactions taking place in the stock exchange, revenue generated under this fluctuates in accordance with the volume of the share market dealings.
Sri Lanka however removed this levy for all transactions on equity from 01 January 2016 in line with a budget proposal aimed at encouraging share market trading.
» CCS.N0000 ( Ceylon Cold Stores)
» Sri Lanka plans to allow tourists from August, no mandatory quarantine
» When Will It Be Safe To Invest In The Stock Market Again?
» Dividend Announcements
» MAINTENANCE NOTICE / නඩත්තු දැනුම්දීම
» ඩොලර් මිලියනයක මුදල් සම්මානයක් සහ “ෆීල්ඩ්ස් පදක්කම” පිළිගැනීම ප්රතික්ෂේප කළ ගණිතඥයා
» SEYB.N0000 (Seylan Bank PLC)
» Here's what blind prophet Baba Vanga predicted for 2016 and beyond: It's not good
» The Korean Way !
» In the Meantime Within Our Shores!
» What is Known as Dementia?
» SRI LANKA TELECOM PLC (SLTL.N0000)
» THE LANKA HOSPITALS CORPORATION PLC (LHCL.N0000)
» Equinox ( වසන්ත විෂුවය ) !
» COMB.N0000 (Commercial Bank of Ceylon PLC)
» REXP.N0000 (Richard Pieris Exports PLC)
» RICH.N0000 (Richard Pieris and Company PLC)
» Do You Have Computer Vision Syndrome?
» LAXAPANA BATTERIES PLC (LITE.N0000)
» What a Bank Run ?
» 104 Technical trading experiments by HUNTER
» GLAS.N0000 (Piramal Glass Ceylon PLC)
» Cboe Volatility Index
» AHPL.N0000
» TJL.N0000 (Tee Jey Lanka PLC.)
» CTBL.N0000 ( CEYLON TEA BROKERS PLC)
» COMMERCIAL DEVELOPMENT COMPANY PLC (COMD. N.0000))
» Bitcoin and Cryptocurrency
» CSD.N0000 (Seylan Developments PLC)
» PLC.N0000 (People's Leasing and Finance PLC)
» Bakery Products ?
» NTB.N0000 (Nations Trust Bank PLC)
» Going South
» When Seagulls Follow the Trawler
» Re-activating
» අපි තමයි හොඳටම කරේ !
» මේ අර් බුධය කිසිසේත්ම මා විසින් නිර්මාණය කල එකක් නොවේ
» SAMP.N0000 (Sampath Bank PLC)
» APLA.N0000 (ACL Plastics PLC)
» AVOID FALLING INTO ALLURING WEEKEND FAMILY PACKAGES.
» Banks, Finance & Insurance Sector Chart
» VPEL.N0000 (Vallibel Power Erathna PLC)
» DEADLY COCKTAIL OF ISLAND MENTALITY AND PARANOID PERSONALITY DISORDER MIX.
» WATA - Watawala
» KFP.N0000(Keels Food Products PLC)
» Capital Trust Broker in difficulty?
» IS PIRATING INTELLECTUAL PROPERTY A BOON OR BANE?
» What Industry Would You Choose to Focus?
» Should I Stick Around, or Should I Follow Others' Lead?