KARACHI, June 3: Capital Gains Tax (CGT) exemption on listed shares has been extended for two years (till June 30, 2010), a press release issued by the Karachi Stock Exchange, following the government-KSE meeting in Islamabad on Wednesday evening, said.

It said that a KSE delegation held a meeting with the Minister of Finance and few members of the EAC to discuss capital market policy. “All stakeholders recognise the key role capital markets can play in attracting investment, boosting confidence, accelerating economic growth rate and increasing employment opportunities,” the KSE statement said and listed the following measures agreed between the two sides:

1. Exemption on Capital Gains on Listed Shares to be extended for 2 years (Till June 30th 2010).

2. Current Tax Regime for Capital Markets to remain unchanged for the up-coming Budget (For Fiscal Year 2008-2009).

3. Demutualisation of the Stock Exchanges to be implemented this year through Finance Bill 2008.

4. Incentives for new listings to be included in Finance Bill 2008.

5. A committee of capital markets and government representatives to develop a 3-year Capital Markets Policy over the next three months. The Capital Market Policy to focus on reforms related to taxation, promotion of new listings, integration of capital markets with the national economy and other measures to ensure a sustainable and healthy capital market for the long term.

6. Government controlled corporations, companies and entities such as Employees Old-age Benefits Institution, State Life Insurance Corporation, port authorities, Oil and Gas Development Company Limited, Pakistan International Airlines, Pakistan Steel Mills Corporation, etc will invest up to 25 per cent of their retirement and long term funds in the equity markets in a phased manner.