Saturday, July 1, 2017

Stock transaction to resume on Sunday

Stocks transaction – which could not take place on Thursday in the secondary market due to high-headedness of share brokers – is going to resume on Sunday, according to the brokers.
The stockbrokers launching a protest to condemn the government’s decision to bring in stockbrokers to value added tax (VAT) regime had closed the market on Thursday 'forcefully' as the capital market regulators – Securities Board of Nepal (SEBON) and front line regulator Nepal Stock Exchange (Nepse) – both remained mute spectators.
"We have agreed to open the transaction on Sunday after the talks with Finance Ministry officials on Friday," said chairman of Stockbrokers’ Association of Nepal (SBAN) Priya raj Regmi after the emergency meeting of the brokers today.
Stockbrokers had completely halted share transactions on Thursday – hurting the investors' sentiment and against the market norms – after the Inland Revenue Offices (IROs) directed two stock brokerages to clear the due VAT levied on commission amounts of the last four years.
The IROs on Wednesday sent letters to Investment Management asking to clear dues of Rs 15 million. Likewise, it also wrote Sundhara Securities asking to submit VAT amount of Rs 6 million. The IROs’ move took brokerage companies by surprise as VAT was never levied on commission generated by stockbrokers before. However, it is not known why the IROs wrote only 2, out of the total 50 broker firms.
The stockbrokers – showing their disagreement – had declined to take purchase and sale orders from the investors on Thursday in a 'syndicate' decision.
Revenue secretary Shishir Dhungana summoned the brokers yesterday – a day after they launched the protest – to discuss on their grievances.
The Finance Ministry has however said that it would not roll back its decision to slap VAT on commission generated by stockbrokers, though it is ready to revise the due amount of the last four years. "The ministry has agreed to find out an alternative to recover the VAT of last four years," the Finance Ministry added.

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