KARACHI: Capital Gains Tax (CGT) collection from the capital market fell 52 percent during the first eleven months of the financial year 2017-18, due to unpredictable trading at Pakistan Stock Exchange (PSX).
According to an official at the tax regulator, National Clearing Company of Pakistan Limited (NCCPL) is responsible for gathering all taxes from sale and purchase of shares, reported The News.
CGT amounted to Rs6.2 billion during July-May FY18 against Rs12.76 billion in the corresponding period of last financial year.
As per Section 233A of Income Tax Ordinance, 2001 the NCCPL has the duty of collecting advance tax from stock exchange members, margin financiers, trading financiers, lenders etc.
The official cited the unpredictable situation at the PSX cause a major plunge in revenue collection.
The entirety of FY18 was marred by political uncertainty for the stock market due to apex court orders in Panama leaks and the indictment of ex-finance minister Ishaq Dar.
Unpredictability has marred the benchmark KSE-100 index in FY18, as it hit a low of 37,919 points on December 19th, 2017 after reaching a record high of 52,876 points in late May last year.
The highest level the PSX has touched this FY18 was 46,827 points. As per the source, the collection of CGT was much higher than the recorded transactions of sales and shares.
The official from FBR said tax authorities had commenced inspection of records to find out the reason for major fall in revenue collection from the equity market.
For this, the tax regulator will carry out a periodical audit of share transactions which were shared by NCCPL and Central Depository Company (CDC).
