Tadawul index breaks 7,000-point barrier

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Updated 06 January 2013
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Tadawul index breaks 7,000-point barrier

The Saudi stock market showed impressive gains yesterday. Tadawul All-Share Index (TASI) crossed the 7,000-mark during the day to close at 7,010.00 points, up 69.69 points or exactly one percent.
Investors were able to continue a bull run as prices of Saudi stocks surging up with high turnover. Tadawul total volume set sold about 276.6 million shares (nearly 39 percent greater than previous level). The 50-day average for trading volume is closer to 181.3 million shares.
A considerable amount of liquidity SR 6.7 billion flowed into the market, an increase of 15.3 percent from previous day's SR 5.8 billion.
Most of the trading was concentrated in the Real Estate Development sector, which liquidated more than 71.3 million shares, a relative market share of 25.8 percent.
The market cap indices closed the day in the green zone.
All sectors closed in the upward district, reflecting an accumulation of 873 points. Positive performance was boosted by Media and Publishing sector, which surged 70.94 points or 2.38 percent to close at 3,045.53. Telecom and Real Estate sectors followed it, advancing more than two percent for the day.
Market breadth with advance-decline ratio of 3.4:1 remained extremely strong.
Share price of Amana Cooperative Insurance rallied to a maximum growth of 10 percent to SR 123.75, clinching the spot as top gainer amongst Saudi stocks.
Most of heavy weights also closed in green, with Etihad Etisalat Co. (Mobily) surging 2.28 percent, Saudi Telecom 2.05 percent and Saudi Arabian Mining Co. 1.51 percent.


Jordanian cabinet approves new IMF-guided tax law to boost finances

Updated 4 min 16 sec ago
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Jordanian cabinet approves new IMF-guided tax law to boost finances

AMMAN: Jordan’s cabinet on Monday approved major IMF-guided proposals that aim to double the income tax base, as a key part of reforms to boost the finances of a debt-burdened economy hit by regional conflict.
“When only 4 percent of Jordanians pay (personal) income tax, this may not be the right thing,” Finance Minister Omar Malhas said in remarks after the cabinet meeting, adding the goal was to push that to eight percent. The draft legislation was submitted to parliament.
The IMF’s three-year Extended Fund Facility program aims to generate more state revenue to gradually bring down public debt to 77 percent of GDP in 2021, from a record 95 percent.
A few months ago Jordan raised levies on hundreds of food and consumer items by unifying general sales tax (GST) to 16 percent — removing exemptions on many basic goods.
In January subsidies on bread were ended, doubling some prices in a country with rising unemployment and poverty among its eight million people.
The income tax move and the GST reforms will bring an estimated 840 million dinars ($1.2 billion) in extra annual tax revenue that will help reduce chronic budget shortfalls normally covered by foreign aid, officials say.
Corporate income tax on banks, financial institutions and insurance companies will be pushed to 40 percent from 30 percent. Taxes on Jordan’s phosphate and potash mining industry will be raised to 30 percent from 24.
The government argues the reforms will reduce social disparities by progressively taxing high earners while leaving low-paid public sector employees largely untouched.
“This is a fair tax law not an unfair one,” said Malhas, who shrugged off criticism the law is lenient on many businesses connected to politicians whose transactions are not subject to tax scrutiny.
Husam Abu Ali, the head of the Income and Sales Tax Department, said a proposed IMF-recommended Financial Crime Investigations Unit will stiffen penalties for tax evaders. Critics say it will not tackle pervasive corruption in state institutions.
Abu Ali said the government could be losing hundreds of millions of dollars through tax evasion, which is as high as 80 percent in some companies.
The amendments lower the income tax threshold and raise tax rates. Unions said the government was caving in to IMF demands and squeezing more from the same taxpayers.
“It is penalizing a group that has long paid what it owes the state,” the unions syndicate said in a statement.
“It imposes injustice on employees whose salaries have barely coped with price hikes rising madly in recent years.”