Sri Lanka stocks end higher
ECONOMYNEXT – Sri Lanka’s stocks closed 0.53 per cent higher on Tuesday pushed up by Expolanka, Sri Lanka Telecom and Melstacorp, Colombo Stock Exchange data showed, as the administration presented the 2021 budget.
Sri Lanka proposes to give 50 per cent off from income tax for all the companies that will be listed under CSE before 31.12.21. After that to keep the tax at 14 per cent up to 3 years.
Up to 100,000 investment relief as a qualifying payment for investors in Treasury bills and stocks will be given.
An investment relief will be given for those setting up bonded warehouses to promote commodity trading.
A 0.25 per cent social insurance fee will be introduced for companies.
Colombo’s main All Share Price Index gained 32.01 points to close at 6,108.
ASPI was seen to be on an upward trajectory throughout the day, settling at 6108.93 losing 5.5 points from the previous day.
S&P SL20 index of most liquid stocks too gained 0.38 per cent or 9.02 points to end at 2,395.71.
The market turnover was 2.2 billion rupees with 119 making profits and 58 making losses.
Counters that contributed most to ASPI were Expolanka gaining 1.50 rupees to trade at 27.50 rupees a share, Sri Lanka Telecom traded 1.10 rupees to close at 33.30 rupees a share while Melstacorp stocks gained 90 cents to 34.60 rupees a share.
Materials industry and transportation industry index were the most active today.
Other key highlights of today’s budget reading were:
-Retirement age of men and women increased to 60 years. Under current laws, men retire at 55 and women 54.
-The construction industry which contributes 10% to Sri Lanka’s GDP will get several concessions. The government is proposing to simplify approvals, certifications and permits, and improve access to raw materials such as sand. Imported inputs for housing will be exempt from import taxes.
-Tea plantation workers will get a wage hike from 01 Jan 2021 to Rs1,000 a day.
Regional Plantation Companies have seen a 25% reduction in productivity and hold unutilized lands, the Prime Minister said.
-Lakvijaya coal power plant to be expanded by adding another 300 MW coal unit and two 600 MW LNG power plants.
– To encourage savings, health insurance premiums, investments in treasury bills and bonds, mortgage payments and investment in companies of up to Rs100,000 per month to be deductible (qualifying payments) in calculating the income for tax purposes.
– Single-use polythene will be banned from Jan 2021
– To support the motor vehicle industry, spare parts will see a reduction in import duties and current import restrictions on vehicle spare parts to be relaxed.