ISLAMABAD : Prime minister , Shahbaz Sharif’s address to the nation on Friday trigered a bloodbath at Pakistan Stock Exchange as KSE-100 index took nosedive and shed 2053 point before the floor was closed for trading at 12 pm.
The prime minister had addressed to the nation on Friday at 11 am and announced 10 % super tax on 13 major sectors . The investors at PSE took Shahbaz Sharif ‘s announcement in a negative sense that created a panic opening a floodgate for off- loading of the stocks by the invedtors. Within one hour or so after the prime minister speech , Pakistan Stock Exchange turned into a bloodbath , causing loss of hundred of billions to the investors . The major industries which will be imposed 10 % super tax included
Cement
steel
sugar
oil and gas
fertilisers
LNG terminals
textile
banking
automobile
cigarettes
beverages
chemicals
airlines
Other than industrial sector , high net worth individuals will also be subject to a “poverty alleviation tax”.
Those whose annual income exceeds Rs150 million will be subject to 1pc tax; for Rs200 million, 2pc; Rs250 million, 3pc; and Rs300 million will be taxed 4pc of their income.
The prime minister speech also resulted in a big loss to the rupee as it lost Rs 1.20 against US dollar in the first half of trading session .
Seeing negative fall out of the prime minister ‘s announcement Finance minister, Miftah Ismail, later clarified on Twitter that the super tax is a “one-time tax needed” to curtail the previous four record budget deficits. He did not elaborate further.
In the address today, the premier took the nation into confidence over what he described as tough budget decisions. He said that the coalition government made courageous decisions to protect the country from serious dangers.
He said the government had two options when it came to the power: call fresh elections or take tough decisions and tackle the sinking economy. “It would have been very easy to leave the public in crisis and become silent spectators like others.”
And despite the challenges, the prime minister pointed out, the government chose the latter.
He said history had witnessed that in difficult times, it was the poor who always made sacrifices.
The prime minister said today, it is time for the affluent citizens to do their part. It is their turn to show selflessness. And I am confident that they will contribute fully to play their part.
He said the institutions whose job was to collect taxes should take from the rich and give to the poor. He, however, lamented that the big ones evade paying taxes.
In the second half , when floor opened for trading it made up some loss that pushed KSE index-100 up marginally .
