ECONOMYNEXT – Sri Lanka’s stock indices closed down on Wednesday, as investors waited for the budget.
The All Share Price Index was down 1.09 percent or 116.95 points to 10,614.46, while the S&P SL20 was down 1.31 percent or 39.64 points to 2,977.38.
“We think the issue is the wait-and-see approach of most buyers is resulting in low buying in the overall market.
So no buyers to take up the selling. That’s causing the market declining. Some are actually selling to buy lower after the budget,” an analyst said.
Turnover was 920 million.
“We saw some buying interest on the foreign front in John Keells. That was significant.”
“Primary dealers again fell in value and that is likely to continue.”
“There is no real push for the market to move. Everybody is sort of waiting.”
Sri Lanka’s 2024 budget is expected next month and apprehension is growing about possible new taxes.
A Parliament Sectoral Oversight Committee on National Economic and Physical Plans has said the government’s tax collection is far behind the target due to the lethargic attitude of the three main state revenue collecting institutions: Inland Revenue Department (IRD), Excise Department, and the Customs.
The government has estimated a revenue target of 3.1 trillion rupees for this year, but as of September 26, the collection has been only 1.64 trillion rupees.
Officials say the government is likely to face a 637-billion-rupee or 20.5 percent shortfall in revenue if the current collection trend continues.
The International Monetary Fund (IMF) has estimated a 15 percent shortfall in revenue but has asked the government to expand the tax net. (Colombo/October25/2023)