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| Last updated at: (Beijing Time) Friday, November 16, 2001 |
China Cuts Stock Trading Duty |
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The stamp duty on stock trading was slashed Thursday, marking the country's big move to
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The stamp duty on stock trading was slashed Thursday, marking the country's big move to boost a deeply bearish stock market.
The Ministry of Finance cut the stamp duties, after months of heated debate, on transactions of both A and B shares to 0.2 percent, 0.2 and 0.1 percentage points lower than their original levels respectively.
The new rates, the lowest since they were introduced some 10 years ago, were scheduled to be effective Friday.
Gao Huiqing, a researcher with the State Information Center, said that the move constitutes a signal from the government to stop the further slide of the stock market, which has lost around 30 percent of the market capital since a peak on June 14.
Experts said that the market slump was caused by the government's sweeping clampdown on fraud and illegal capital sneaking into the market. Worries about a flood of domestic A-share issues and the selling of state-held shares to investors at high prices also depressed the markets.
He Zhenyi, a senior economist with the Chinese Academy of Social Sciences, said that lowering the stamp duty also brings it closer to the levels in other nations and is necessary after the country's entry into the World Trade Organization.
The move is expected to lower trading costs for investors as well as help China's struggling brokerage companies.
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