Hong Kong Stock Market’s Record Year Slams Into a Big Tax Increase

Link: https://www.wsj.com/articles/hong-kong-stock-markets-record-year-slams-into-a-big-tax-increase-11614153184

Excerpt:

Hong Kong moved unexpectedly to raise taxes on share trading by 30%, putting a damper on the city’s stock-exchange operator just as it was unveiling record annual sales and profits.

….

Paul Chan, the city’s financial secretary, proposed lifting the so-called stamp duty on stocks to 0.13% from 0.1%, as part of Hong Kong’s annual budget. The increase, which is the first in nearly three decades, would effectively add $3 to the cost of each $10,000 of stock traded, for both buyers and sellers. Some securities are exempt.

The looming tax increase pummeled Hong Kong Exchanges shares, even as it reported the equivalent of $1.48 billion in net profit for 2020, a 23% increase and its biggest-ever haul. The company’s stock, which has recently hit record highs, fell as much as 12% before paring some losses to close 8.8% lower. The city’s benchmark Hang Seng Index fell 3%.

Author(s): Joanne Chiu

Publication Date: 24 February 2021

Publication Site: Wall Street Journal