The Pakistan Stock Exchange (PSX) crashed on Friday minutes after Prime Minister Shahbaz Sharif announced a 10 Percent tax on large-scale industries. The bourse stayed flat until two hours after the opening bell. However, at 11:40 Am, the market witnessed a steep dip with KSE-100 losing 1,598 points. And sinking to 41,100 at 12 pm, the benchmark KSE-100 index was down 2,053 points or 4.8pc.
As per PSX Rulebook, if the index goes five percent cant above or below its last close and stays there for five minutes. Trading in all securities is halted for a specified period.
Intermarket Securities head of equities Raza Jafri cited “massive taxes” as the reason behind the plunge. “The market has reached very negatively because it will severely hurt corporate profitability.”
Ahsan Mehanti of the Arif Habib Corporation concurred. “PSX witnessed massive pressure across the board after PM announced 10% super tax on industrials for one yea to bridge the gap in the fiscal deficit,” he said.
Meanwhile, Khurram Shehzad, CEO of Alpha Beta Core, said that after the government’s latest measures. The corporate income tax and investor tax. Will now exceed 50pc and 55pc, respectively.
“This is the highest not only in this region but in the history of Pakistan. In fact, It is one of the highest tax rates in the world,” he pointed out.