Colombo shares slump on increased taxes

  The Colombo bourse fell sharply in Friday’s trading, on the back of the mini budget which saw many increased taxes. Analysts said the new Finance Minister Ravi Karunanayake’s revised fiscal budget for 2015 hasn't been easy on listed companies. The one off tax of 25 per cent on corporates and individuals earning a profit of over Rs. 2 billion for this financial year would have a significant impact on the bottom-line of such companies, they said, adding that there are some 30 firms which earn more than Rs.2 billion and represent nearly 55 per cent of the market capitalization. "This does not augur well for these shares," an analyst said, adding that Dialog was down 2 per cent to Rs.12 at 12.30 pm, leading to a 200 point dip in All Share Index (ASI). The new fiscal plan for the year had many surprises while also accommodating the expected relief proposals as mentioned in their election manifesto. This benchmark index saw a sharp fall by 2.66 per cent to 7,180.05 while the S&P dropped by 4.17 per cent to 3,962.24 on Rs. 2 billion turnover. - ENDS-