PSX seeks rationalisation of tax rates

Published June 8, 2021
PSX CEO said a broad-based capital market helps to achieve important economic and social objectives. — AFP/File
PSX CEO said a broad-based capital market helps to achieve important economic and social objectives. — AFP/File

ISLAMABAD: The Pakistan Stock Exchange (PSX) has sought rationalisation of tax rates for listed companies and aligning rates of capital gain tax on disposal of securities in line with regional practices in its budget proposals.

At a meeting chaired by Federal Minister for Finance and Revenue Shaukat Tarin on Monday, PSX Managing Director & CEO Farrukh H. Khan submitted the proposals and gave a detailed presentation on the huge impact of stock markets on wealth creation and mobilisation of capital.

Mr Khan said a broad-based capital market helps to achieve important economic and social objectives like increasing the number of tax payers, optimising savings and investment rates, and reducing wealth inequalities. Tax measures are an important policy tool to increase investments and savings in the economy and to stay competitive with other markets, he added.

The PSX proposals include aligning rates of capital gain tax on disposal of securities, rationalisation of tax rates for companies listed on the stock exchange, enhanced tax credit for listed small and medium enterprises, unlocking the potential of private funds and many other suggestions that will help broadening the tax base/revenue collection.

Mr Tarin said the government was strongly committed to strengthening of the financial markets and ready to adopt measures that could mobilise capital to more productive sectors. He further said the government was considering to introduce new tax regime that is in accordance with the changing economic environment.

He welcomed the PSX proposals and assured that these will be given due consideration in the upcoming budget.

Published in Dawn, June 8th, 2021

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