While the stock market had significant growth during the fiscal year 2020/21, the collection of capital gains tax (CGT) has decreased by 7% in that same year.
According to the information made public to BOL, the total amount of capital gains tax collected during the fiscal year 2020/21 was Rs1.82 billion, a decrease from the previous fiscal year’s total of Rs1.94 billion.
Officials at the Federal Board of Revenue (FBR) stated that the reduction in tax revenue under this heading was due to the modifications made by the Tax Laws (Amendment) Ordinance, 2021, which was passed in February 2021 and took effect immediately.
Another factor contributing to lower tax income was the passage of a law by the government in January 2019 that allowed for the carrying forward of losses. The Revenue Board, on the other hand, recently modified the Income Tax Rules, 2002, to include the legislation governing carry forward losses within the rules.
During the fiscal year 2020/21, the total performance of the Pakistan Stock Exchange (PSX) produced a 38 percent return, which was its greatest return since the fiscal year 2013/14.
KSE-100 index, the benchmark for the country’s stock market, ended the year with a favorable return, achieving a notable increase of 38 percent, according to Arif Habib Limited.
The benchmark index closed at 47,356 points, marking the best-ever closing level at the end of June, while the market’s returns (+38 percent) are the greatest since 2013/14 (+41 percent).
A number of events occurred throughout the year, according to the analysts, including political unrest in the country, which occurred amid an alliance of opposition parties under the banner of Pakistan Democratic Movement in the run-up to the Senate elections in March 2021, and the re-emergence of the infamous Covid waves.
Nonetheless, the economic recovery remained a key theme throughout the fiscal year under review, contributing to the positive environment on the stock exchange.
Follow Newsline.pk on Facebook, Twitter, and Instagram.
