ECONOMYNEXT – Sri Lanka’s stocks surged 1.6 percent in the first hour of trading after the government announced a slew of tax cuts that may help boost corporate earnings and demand, brokers and analysts said.
The Colombo All Share Index was up 1.6 percent in the first hours of trading with a turnover of 1.1 billion rupees.
Sri Lanka’s cabinet approved a cut of value added tax 8 percent which will help consumer firms.
Nestle was up 47 rupees to 1,300, Hemas was up 2.0 rupees to 83 rupees, Ceylon Tobacco was up 20 rupees to 1,150 rupees and Distilleries was up 80 cents to 19.50 cents Ceylon Cold Stores was down 10 cents to 815 rupees.
For construction sector, income tax was cut from 28 percent to 14 and value added tax was removed.
Access Engineering was up 1.30 rupees to 23 rupees, Tokyo Cement gained 1.50 to 53 rupees. John Keells Holdings was up 1.50 rupee 165 rupees.
A debt service tax for banks would also be cut.
Commercial Bank was up 1.80 rupees to 101.80 rupee and Hatton National Bank was up 2.50 to 143 rupees and Sampath was up 5 rupees to 172.90 rupees.
A 25 percent cut was also announced in a telecom levy.
Dialog was up 80 cents to 13.80 rupee and Sri Lanka Telecom was up 1.70 rupees to 33.50 rupees. (Colombo/Nov28/2019)