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SEC welcomes market-friendly budget proposals

19 November 2020 12:15 am - 0     - {{hitsCtrl.values.hits}}

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  • Hails incentives announced for REITS; points out Stamp Duty reduction will be a major boost 
  • Points out 50% income tax discount announced will be an impetus for new listings

Securities and Exchange Commission of Sri Lanka (SEC) Chairman Viraj Dayaratne P.C. commended the budget proposals presented to Parliament on Tuesday by Prime Minister Mahinda Rajapaksa, in his capacity as the Finance Minister. 


The proposals included several measures to develop the capital market of Sri Lanka. As an incentive to promote and popularise Real Estate Investment Trusts (REITs) that were enabled by the SEC by way of its Rules published in the gazette on July 31, 2020, the proposals stated that the investments in REITS are exempted from the Capital Gains Tax and the dividends are to be free from income tax.  

Further, the Stamp Duty is to be reduced up to 0.75 percent, from 4 percent. The stakeholders in the industry had perceived the Stamp Duty as an impediment to the setting up of REITS in Sri Lanka and the SEC sees this proposal as a huge boost to setting up of REITS in the country.In addition, to promote new listings of local companies on the Colombo Stock Exchange (CSE), the government has put forward certain key proposals, such as a 50 percent tax concession for the years 2021/2022, for companies that are listed before December 31, 2021. 
The number of companies listed on the CSE has not increased during the last several years and that was seen as a reason for the lack of liquidity and relatively small size of the market. The new proposal will be an impetus for new listings.


The SEC thanked the President, Prime Minister, Money and Capital Markets State Minister, Secretary to President and Secretary to Treasury, for having taken into consideration the representations made by the SEC and for taking these initiatives, which would help to develop and build a strong capital market, which could benefit both users and providers of capital. 


“These efforts will undoubtedly help deepen market activity and increase access to capital for Sri Lankan corporates,” Dayaratne said.


The CSE has functioned uninterrupted and has performed exceptionally well with an 80 percent increase in total market turnover, as against 2019 and the average daily turnover has doubled. “The steps taken by the joint committee comprising of representatives of the SEC and CSE to digitalise the stock market in September 2020, have enabled the market to operate without interruption, despite the present situation in the country. I wish to express my sincere gratitude to all the stakeholders in the capital market industry, particularly the CSE and stockbroking community for the unstinted support given to facilitate the end-to-end digitalisation of the market,” Dayaratne added.

 

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See Kapruka's top selling online shopping categories such as Toys, Grocery, Flowers, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,News, Courier/Delivery, Food Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka.

 

 

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