KARACHI, June 13: Firozuddin Cassim, chairman of the board of directors of Karachi Stock Exchange, said the budget 2003-04 was ‘growth oriented and investor-friendly’, which would bring indirect gains to the capital markets.

Presiding over a special budget committee session on Thursday, Mr Cassim noted that the KSE-100 index had gained more than 100 points since the budget announcement.

A press release issued by the bourse on Friday said that the members of the committee noted that even though the budget did not include the proposals put forth by the KSE, it would provide sufficient indirect benefits to the capital market. Various incentive have been provided in the budget, including cement and housing; initial depreciation on second-hand machinery, reforms in CED and sales tax, concessionary tax on foreign-sourced income, abolition of wealth tax act, 3 per cent provision of bad debt for consumer loans and allowance of carried-over losses for the industries in the tax-holiday zones, which would boost the activities of several sectors.

The press release stated that the KSE chairman observed that the budget had envisaged the fact of continuity of economic policies without any new taxes, which were the most significant features of the budget. The members of the committee meanwhile drew attention of the finance minister to two anomalies in the budget. These included the grant of capital gains tax exemption for insurance companies and a one-time tax exemption on transfer of individual members to corporate membership.

“The committee anticipated that these anomalies will be removed while formalization of the current fiscal budget,” the KSE said.