Last Update 0:25
Wednesday, 13 November 2019

Egypt's stocks rally on news of milder tax law

Main index rebounds 1.53 percent as exemptions widened and tax rate reduced for some shareholders, who were spooked after approval of capital gains tax (CGT)

Ahram Online, Monday 2 Jun 2014
Egypt
Egypt's Cabinet meeting (Photo courtesy of the Egyptian Cabinet)
Share/Bookmark
Views: 2169
Share/Bookmark
Views: 2169

Egypt's stocks rallied on Monday after a cabinet decision to amend a recently-introduced controversial capital gains tax (CGT) law, with the main EGX30 index rising 1.53 percent to reach 8,015 points.

The 10 percent tax imposed last week triggered a sharp fall in the main index, which hit a four week-low on Sunday, closing at 7,894 points.

The tax on profits and dividends of the listed securities aimed to reap LE10 billion ($1.4 billion) a year for the public treasury, Finance Minister Hany Kadry Demian explained to Reuters on Thursday.

But the market's reaction led the cabinet of Prime Minister Ibrahim Mahleb to amend the CGT on Sunday, exempting share dividends and cash dividends up to LE15,000 from paying the new tax, Al-Ahram's Arabic news website reported.

The tax rate will also be reduced to 5 percent on cash dividends for shareholders who own 25 percent or more of the listed companies' capital.

The cabinet also decided to cancel the 0.001 transaction tax that was imposed on stock exchange investors in 2013.

The majority of EGX30's shares were in the green on Monday, as Egyptian investors acted as net-sellers for the session to the tune of LE37.8 million and non-Arab foreigners were the main net-buyers for LE31 million.

The most traded share was Orascom Telecom Media and Technology Holding (OTMT), with a turnover value of LE99 million, rising 3.39 percent to trade at LE1.22 a share.

Market bellwether Commercial International Bank (CIB) rose 2.51 percent to close at LE35.98.

Real estate shares also made gains, as Six of October Development and Investment (SODIC) rose 2.24 percent to LE26.43, Palm Hills Development Company rose 1.72 percent to LE4.14 and TMG Holding rose 1.04 percent to LE8.75. 

In the telecom sector, fixed-line operator Telecom Egypt (TE) rose 1.69 percent to LE13.27 and Global Telecom Holding rose 0.99 percent to LE5.12.

The broader EGX70 index was up 0.5 percent.

 
Short link:

 

Email
 
Name
 
Comment's
Title
 
Comment
Ahram Online welcomes readers' comments on all issues covered by the site, along with any criticisms and/or corrections. Readers are asked to limit their feedback to a maximum of 1000 characters (roughly 200 words). All comments/criticisms will, however, be subject to the following code
  • We will not publish comments which contain rude or abusive language, libelous statements, slander and personal attacks against any person/s.
  • We will not publish comments which contain racist remarks or any kind of racial or religious incitement against any group of people, in Egypt or outside it.
  • We welcome criticism of our reports and articles but we will not publish personal attacks, slander or fabrications directed against our reporters and contributing writers.
  • We reserve the right to correct, when at all possible, obvious errors in spelling and grammar. However, due to time and staffing constraints such corrections will not be made across the board or on a regular basis.
2



ayman
03-06-2014 11:09am
0-
2+
Steps
Now to gradually eliminate the subsidy system and revamp the wages structure so that the poor don't need handouts and can get a fair wage for fair work. This will also invigorate the economy in so many ways.
Email
 
Name
 
Comment's Title
 
Comment
1



Aladdin, Menya
02-06-2014 07:01pm
0-
20+
Fair Taxes
We have good treasury secretary Mr. Dimian. The taxws are fair and ends the free ride on the back of poor. It is fare less than capital gain in other countries I know. As you know, it is not constitutional. LOL.
Email
 
Name
 
Comment's Title
 
Comment
Latest

© 2010 Ahram Online.