NEPSE: Tax anxiety triggers decline in Nepal stock market


Kathmandu, June 18

The Nepal Stock Exchange (NEPSE) experienced a significant decline on Tuesday, with all indices falling. The NEPSE index dropped by 18.76 points, or 0.89 per cent, closing at 2,076 points. The total transaction volume for the day amounted to Rs 4.05 billion.

In addition to the NEPSE index, all sectoral indices also saw decreases. The banking sector fell by 13 points, development banks by 36 points, finance companies by 23 points, hotels and tourism by 39 points, hydropower by 22 points, life insurance by 100 points, manufacturing by 34 points, microfinance by 29 points, non-life insurance by 88 points, others by 12 points, and the trading group by 18 points. While the prices of 40 companies increased, 198 saw a decline, and 9 remained unchanged.

Among notable gainers, the share price of Samaj Laghubitta surged by 10 per cent. Mandu Hydropower saw a 7.8 per cent increase, VIN Nepal Laghubitta rose by 6.2 per cent, Divyashwori Hydropower by 4.8 per cent, and Aatmanirbhar Laghubitta by 3.7 per cent. Conversely, Manakamana Smart Laghubitta and Kutheli Bukhari Small Hydropower both dropped by 10 per cent, Barahi Hydropower fell by 6 per cent, Bhagawati Hydropower by 4.7 per cent, and Menchyam Hydropower by 4 per cent.

Based on transaction amounts, Barun Hydropower, CEDB Hydropower, NRN Infrastructure, Global IME Laghubitta, and Mandu Hydropower were the top performers.

The market sentiment was notably affected by discussions surrounding a recommendation to include individual income from share trading under income tax. The suggestion, part of a report by a high-level tax system reform committee chaired by Bidyadhar Mallik, has sparked concerns among investors.

The recently released report advises that individuals engaged in professional share trading should have their income assessed and taxed in accordance with the Income Tax Act. This recommendation has led to anxiety among investors, contributing to the market’s decline on Tuesday.

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