Securities stocks gain amid share tax rumour

Shares of Finansia Syrus Securities (FSS) led gains for securities stocks yesterday, according to industry sources, based on the possibility the government may delay the implementation of the controversial financial transaction tax (FTT).

FSS shares rose 29.7% to hit a price ceiling yesterday as stocks of other securities firms also surged sharply.

One broker who requested anonymity said the increase was fuelled by speculation the FTT would be postponed from the middle of this year.

The cabinet in late November approved the FTT for individual stock investors, ending a four-decade waiver.

The collection is part of Revenue Department regulations that require the payment of a 0.1% specific business tax on securities trades and a related local tax of 10% of the specific business tax.

Brokers said enforcement of the FTT or share sales tax could prompt foreign investors to leave the Thai stock exchange because it increases transaction costs and reduces liquidity.

“The draft law has been endorsed by the Council of State, but it has not been published in the Royal Gazette as of Jan 31,” said the source.

“There were reports the government has yet to decide when the draft legislation would be presented to His Majesty the King to sign, meaning there is a possibility its implementation might be delayed.”

It is uncertain whether the FTT will take effect this year as the next general election is scheduled in roughly three months, the source said.

Other listed securities firms such as FNS Holding (FNS) rose 18.8% in afternoon trade yesterday, while Globlex Holding Management (GBX) was up 16.5%.

More gainers for the day included Trinity Watthana (TNITY), which surged 10.1%, and UOB Kay Hian Securities (Thailand), which rose 8.33%.