Wed, Apr 11, 2012 - Page 11 News List

[ BUSINESS BRIEFS ]

Staff writer, with Agencies

TAIEX rises on tax news

The TAIEX rose 0.52 percent yesterday as investor sentiment improved after a clearer picture emerged of a government plan to tax gains on sales of stock, dealers said.

The government eased concerns of retail investors when it said it would likely only subject investors with large trading volumes to capital gains taxes on stock investments, though no specifics were provided.

The broader market was also boosted by rising old-economy shares in the food, tourism and glass sectors, dealers said.

The TAIEX finished up 39.81 points to close at 7,640.68 on relatively low turnover of NT$67.80 billion (US$2.30 billion).

A total of 2,400 stocks closed up and 1,512 finished down, while 405 remained unchanged.

All of the eight major stock categories finished higher, with the cement sector leading the way with gains of 1.5 percent.

Long road before gains tax

A Ministry of Finance proposal to tax gains from stock trading would require Cabinet approval and then would have to be passed by the legislature before it could take effect, ministry officials said yesterday.

“Only after the Legislative Yuan has passed an amendment to the relevant law will the government be able to announce a date for the implementation of the tax,” said the officials, who asked not to be named.

While the capital gains tax is expected to be introduced in 2014, which means that profits made the previous year from stock transactions would be subject to taxation, the ministry has not yet decided on a formula for calculating the tax.

The ministry will submit a proposal to the Cabinet tomorrow.

Next Media’s shares spike

Next Media Ltd’s (壹傳媒集團) shares rose the most in more than three years in Hong Kong trading yesterday.

The company insisted that it was not aware of reasons for the surge, after a magazine reported it might sell its businesses in Taiwan.

Next Media chairman Jimmy Lai (黎智英) is seeking to sell the company’s Taiwan business for US$500 million, Taipei-based The Journalist reported last week, citing unidentified people in the banking industry.

Next Media shares rose as much as 28 percent, the biggest intraday gain since February 2009, to HK$0.78. The shares ended up 13.11 percent, at HK$0.69, in Hong Kong.

Demand for bonds drops

Taiwan’s five-year bonds yesterday fell for the first time in three days, after demand dropped at an auction on concerns that faster than expected inflation would erode returns.

Bids for the securities exceeded the amount on offer by 1.59 times, according to the central bank, compared with 2.13 times at the previous auction.

The maximum yield at which bids were accepted was 1.029 percent, up from 1 percent in January.

The yield on the country’s 1 percent bonds due in January 2017 increased one basis point, or 0.01 percentage point, to 1.027 percent, according to the GRETAI Securities Market.

The overnight money market rate was little changed at 0.46 percent, according to a weighted average compiled by the Taiwan Interbank Money Center.

NT dollar loses ground

The New Taiwan dollar fell against the US dollar yesterday, declining NT$0.002 to close at NT$29.570.

Total turnover was US$486 million during yesterday’s trading session.

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