PSX demands end to tax policy distortion

Pakistan Stock Exchange (PSX) chief executive Farrukh H. Khan said on Tuesday the government should do away with the distortion in its tax policy that currently favours certain asset classes against others. Speaking at a press conference, Mr Khan called for aligning the tax rates for the equity market with those on real estate and agriculture, sectors that’ve traditionally remained undertaxed for decades. “We don’t want any tax relief for the stock market. All we demand is that the government ensure a level playing field that treats all asset classes equally,” he said while briefing journalists on the exchange’s tax proposals for 2023-24. By his own reckoning, the stock market has been “subdued” and valuation are “very low” for a host of reasons. The benchmark index of the PSX has barely moved since the beginning of 2022-23 – a phenomenon that the PSX CEO attributed partly to overall macroeconomic indicators. For example, interest rates are at an all-time high, which means mutual fund managers have diverted more than 80 per cent of their assets under management to risk-free, fixed-income securities, he said. Mr Khan expressed hope that the coming months will bring investors back to the equity market. “For the first time, UINs have crossed the 300,000 mark,” he said while referring to the unique identification number that every investor receives to ensure all trades and transactions remain traceable.