The Nigerian Stock Exchange (NSE) has begun moves to put an end to the tradition whereby taxes are paid on the transactions held on the floor of the exchange.

NSE Director General, Mr. Oscar Onyema, disclosed this during an interactive session with the media at the Kaduna branch of the Exchange.

Onyema disclosed that meetings were being held with the various stakeholders, including government agencies to stop the payment of taxation on transactions held on the floor of the NSE.

He added that with the successful launch of the gold Exchange Traded Fund (ETF) in Lagos recently, the NSE was already working hard to ensure that other ETFs follow suit, stressing that this would further boost commodity trading in the country.

Onyema noted that the exchange was also working on driving investors’ education through investors’ clinic and market segmentation.
“We are in Kaduna to engage the brokerage community in the cachment area to see how we can facilitate capital raising and investors rising. Though improving investors’ confidence is challenging, the exchange is making lots of efforts to ensure that there are the right people in the right positions to drive strategic initiatives and communications with different stakeholders.

“We are advocating position with different agencies and government that there should be no taxation on transactions on the floor of the exchange, the Value Added Tax and stamp duties could go as high as 12 per cent, for trading which is from investors while VAT is consumption tax. We are also following other positions in different strata of government and appropriate communities.

“Following the ABSA new gold ETF which tracks the value of gold, US Dollars and Naira because the global gold market is traded in dollars and the ETF is traded in naira, there would be other ETFs to track some of our equity indices such as the NSE 30 index to track the top 230 listed stocks,” he said.

Onyema, who was in company with the NSE General Manager and Head of Listing, Sales and Retention, Taba Peterside, further explained that the exchange was working on other things, including, “strong regulatory programme, appropriate market structure to facilitate liquidity and debt in the market, introduction of market marker, security lending and short selling, new listing standards and ensuring transparency.

“We are also working on the market segmentation to ensure understanding in the grouping of companies into large, medium and small capital as well as income and growth company.

“Income companies pay over 50 per cent of their revenues as dividends, while growth companies retain more earnings to reinvest in the company, so with the right information investors can decide to go for high dividends or high growth for capital acquisition” he added.

Source: ThisDay/John Shiklam