November 30: The government has collected more than Rs 98.1 million in taxes from investors of the secondary market in a one month period starting from mid-October. Investors of the secondary market paid capital gains tax equal to that amount to the government for making profit. Compared to mid-September to mid-October, the capital gains tax collected in mid-October to mid-November is Rs 43.7 million more. In mid-September to mid-October, Rs 54.4 million was collected from capital gains tax.
In the following month, the government collected more capital gains tax from long-term investors than from short-term investors. CDS and Clearing Limited (CDSC) informed that more than Rs 47.1 million was collected from short-term investors and more than Rs 51.1 million from long-term investors.
Investors in the securities market have been paying capital gains tax based on weighted average cost. The government has been collecting up to 10 per cent capital gains tax from the profits earned by investors in the secondary market. Ten per cent capital gains tax is collected from institutional investors in the securities market and 7.5 per cent from individual investors.
Among the individuals, the government collects tax by considering those who hold shares for more than 1 year as long-term investors and those who hold shares for less than 1 year as short-term investors. Short-term investors have to pay 7.5% capital gains tax and long-term investors have to pay 5% capital gains tax.
Based on the fact that long-term investors paid more capital gains tax for the last 2 months, investors who have been in a wait-and-see state of mind for the past 1 year have estimated that profits have increased.