ISLAMABAD: Stockbrokers on Wednesday welcomed the federal budget for the fiscal year 2024-25 and have expressed confidence that positive sentiments will be witnessed in the capital market.

Pakistan Stock Exchange (PSX) Managing Director Farrukh H. Khan lauded the federal budget, saying that tough measures were necessary and such steps have to be taken in all sectors of the economy.

“While the capital gains tax has been increased in the stock market as a flat rate of 15 per cent has been imposed — contrary to the zero rate after holding any scrip for six years — the imposition of 45pc tax on non-filers was a healthy sign,” Mr Khan said.

However, he added that there were hardly any non-filer investors in the stock market. Still, this move will give positive signals to other sectors that the economy needs to be documented.

Adil Ghaffar, a senior member of the Stock Brokers Association of Pakistan, in his reaction to the budget, appreciated the restriction imposed on mutual funds by increasing taxation as a welcoming sign for investors.

“Under the new measures, if the mutual funds and the real estate investment trusts invest in debt securities like T-bills, 25pc income tax on dividends will be implemented,” Mr Ghaffar said. The income tax for the mutual funds to invest in the capital market was 15pc.

He further said that the taxation measure on the real estate sector will also have a positive sign on the capital market, and encouraging sentiments will be seen in the PSX in the coming days.

Published in Dawn, June 13th, 2024