Caption: Jinita Prasad. File Photo.
The South Pacific Stock Exchange (SPSE) welcomes the Government’s 2014 Budget announcement. The announcement underlined Government’s commitment to promoting the development of the capital markets in the region both in terms of increased listings and increased trading. The SPSE believes that the incentives announced in the 2014 Budget lay a solid platform for the market and will be a major encouragement for local private companies to consider listing.
Commenting on the announcement, SPSE Chief Executive, Ms Jinita Prasad said “It is very encouraging to note the corporate tax rate for companies that list or are listed on the Exchange’s official list will be reduced to 10% from the current 18.5% rate. This will be applicable to all companies across the board. Moreover, any trading of shares on the Exchange will be exempt from any Income Tax and Capital Gains Tax. Furthermore, we are pleased to note that all consequential gains arising from any restructure, reorganisation or amalgamation of private companies for the purpose of listing on the Exchange will be exempt from any taxes. Inconsistency in tax application in the past has been a major hurdle for the market that had created a lot of uncertainty which has now been addressed through these exemptions.”
Ms Prasad said “We anticipate that this tax incentive will create much interest amongst private companies in listing on the stock exchange. SPSE with other capital markets professionals will work to encourage companies to take advantage of this and other tax incentives announced by Government.”
The Exchange’s prospects have always been linked with its ability to provide capital raising avenues for listed companies and as such, the tax incentives supplement the Exchange’s core strategies. Furthermore, the exemption of Income Tax and Capital Gains Tax from share trading will benefit the various stock market investors including the “mums and dads” as well as promote the much needed savings and investment culture in Fiji. The incentives, in encouraging listings, will also encourage greater transparency and accountability by companies to their shareholders.
The Exchange acknowledges the continued support of Government in terms of the grant received. This enables the Exchange to continue developing the market, carry out investor education programs and listing campaigns, and enhance our infrastructure.
Should you require any further information on this issue, please do not hesitate to contact us.