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Thursday, February 05, 2004
Senate junks DST on trade deals
By Cherry T. Lim
THE Senate passed Monday a bill seeking to abolish the documentary stamp tax (DST) on secondary trade transactions, but the same measure also increases the DST rate for debt instruments.
According to the Philippine Stock Exchange, President Arroyo is expected to sign the bill into law this month.
The sale or exchange of shares of stock listed and traded through the local stock exchange will now be exempt from the DST for five years, a move seen to boost liquidity in the local securities market and strengthen its competitiveness in the region.
Fixed income and other securities traded in the secondary market or through an exchange will now also no longer be subject to the DST.
For the original issuance of shares of stock, the DST rate was halved to P1, from P2, on each P200 or fraction thereof.
The same was done for the DST rate on sales, agreements to sell, memoranda of sales, deliveries or transfer of shares of certificates of stock, with the rate now at 75 centavos on each P200 or fraction thereof.
But the DST rate for the original issuance of debt instruments more than tripled to P1 on each P200 from the current 30 centavos.
(February 5, 2004 issue)
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