Exclusive-China plans to cut stamp duty on stock trading by up to 50% to revive sentiment-sources

Exclusive-China plans to cut stamp duty on stock trading by up to 50% to revive sentiment-sources

Beijing/Hong Kong (Reuters) – According to three persons Exclusive-China plans with knowledge of the situation, Chinese officials are preparing to reduce.

The stamp tax on domestic stock trading by as much as 50% in an effort to revive the faltering stock market of the country.

According to two of the persons, Chinese regulators, including the Ministry of Finance, submitted a draft proposal to the cabinet earlier this month under the direction of the State Council.

They add that a decision may be taken and made public as soon as this Friday. Exclusive-China plans.

The two persons claimed that the suggestion to lower the current 0.1% stamp tax on securities trading proposed a reduction of 20% or 50%, which would mark the first reduction since 2008.

They predict that the cut’s magnitude, which had not previously been disclosed, would be set at 50%.

Due to their lack of authorization to speak to the media, all of the sources decline to be idea file.

A fase request for response was not immediately answer by the State Council Information Office, which responds to media inquiries on behalf of the government.

Neither the China Securities Regulatory Commission (CSRC) nor the Ministry of Finance responded right away.

The planned drop comes after China’s officials promised to revive the world’s second-largest stock market in late July.

Exclusive-China plans

The market has been in free fall as the nation’s economic recovery stalls and problems in the real estate sector worsen.

Blue-chip CSI300 Index for the nation has fallen to nine-month lows and is down 11% from its peak in April as expectations for a post-COVID economic recovery and a surge in corporate earnings evaporated.

MSCI’s global market index has increased 11% so far this year, in contrast. LACK luster growth.

The second-largest economy in the world expanded slowly in the second quarter due to weak domestic and international demand, leading economists to lower their growth projections for the year in the absence of any policy support measures.

Beijing has taken a number of efforts to bolster the markets in the face of escalating headwinds, including a smaller-than-expected reduction in a crucial lending benchmark and other actions earlier this week.

Investors are demanding bigger policy packages that include significant government spending, so the moderate stimulus has so far failed to appease them and stimulate a weakening economy.

According to Reuters earlier on Friday, which cited sources with direct knowledge of the situation, China’s central bank has most recently instructed some domestic banks to reduce their foreign investments under the Bond Connect scheme.

In order to support the $11 trillion stock

Market in China, the country’s securities regulator published a set of measures on August 18. These included encouraging long-term investment and supporting share buybacks.

Stabilizing the stock market was a top objective, according to the CSRC. “There is no foundation for reviving the market and boosting sentiment without a relatively stable market environment.”

According to China’s Stamp Duty Law, which went into effect in July 2022, any reduction or exemption of stamp duties, including the one on stock trading, can be approve by the State Council, base on the needs of the country’s economic and social growth.

In a note, analysts at broker Topsperity Securities stated. That a Exclusive-China plans. reduction in stamp duty (on stock trading) might lower investment costs and increase trading activity.

A reduction in stamp duty may have a greater impact on restoring investor confidence than prior policy actions. The effect light be animal the long run.

276 billion yuan, or 1.35%, of China’s fiscal revenue last year, which totaled 20.37 trillion yuan ($3.02 trillion).

Bloomberg was the first to report earlier this month that Chinese regulators were thinking about reducing the stamp fee on stock transfers.

Exclusive-China plans

(Reporting by the newsrooms in Beijing and Hong King. Additional reporting by the newsroom in Shanghai editing by Lincoln Feast and Sumeet Chatterjee.)

Reuters, HONG KONG/BEIJING, August 25 – According to three persons with knowledge of the situation.

Chinese officials are preparing to reduce the stamp tax on domestic stock trading. By as much as in an effort to revive the faltering stock market of the country.

According to two of the persons, Chinese regulators, including the Ministry of Frnance. Submit a draft proposal to the cabinet earlier this month under the direction of the State Council.

They add that a decision may be taken and made public as soon as this Friday. LACK luster growth.

The two persons claime that the suggestion to lower the current. Stamp tax on securities trading propose a reduction of which would mark the first reduction since 2008.

They predict that the cut’s magnitude, which ha not previously been disclose, would be set.

Due to their lack of authorization to speak to the media. All of the sources decline to be idea Exclusive-China plans.

A fax request for response was not immediately answer by the State Council. Information Office, which responds to media inquiries on behalf of the government.

Neither the China Securities Regulatory Commission (CSRC) nor the Ministry of Finance responded right away.

The planned drop comes after China’s officials promised to revive the world’s second-largest stock market in late July. The market has been in free fall as the nation’s economic. Recovery stalls and problems in the real state sector worsen.

As expectations for a post-COVID economic recovery and corporate earnings boom. The country’s bluechip CSI300 Index fell to nine-month lows and is down 11% from an April peak. MSCI’s worldwide stock index has gained 11% so far this year, in contrast.

The second-largest economy in the world expand slowly in the second quarter due to weak domestic and international demand. Leading economists to lower their growth projections for the year in the absence of any policy support measures.

Beijing has taken a number of efforts to bolster the markets in the face of escalating headwinds. Including a smaller-than-expect reduction in a crucial lending benchmark and other actions earlier this week.

Investors are demanding bigger policy packages that include significant government spending. So the moderate stimulus has so far fail to appease them and stimulate a weakening economy.

According to Reuters earlier on Friday, which cited sources Exclusive-China plans with direct knowledge of the situation.

China’s central bank has most recently instruct some domestic banks to reduce their foreign investments under the Bond Connect scheme.

In order to support the $11 Million stock market in China. The country’s securities regulator publish a set of measures on August 18. These included encouraging long-term investment and supporting share buybacks.

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