Sri Lankan shares post over 6-wk closing low on VAT hike concern
Reuters β Sri Lankan shares posted their lowest closing level in more than six weeks on Thursday, as a government proposal to raise the value added tax (VAT) weighed on markets. The government on Wednesday said the cabinet has approved a proposal to increase the VAT to 15 percent from 11 percent with some amendments, a move halted by the Supreme Court earlier. The hike is expected to be implemented after parliamentary approval later this month. The benchmark Colombo stock index ended 0.31 percent weaker at 6,472.47, its lowest close since Aug. 1. It fell 0.34 percent for the week, its fourth straight weekly loss. Both the stock and foreign exchange markets will be closed on Friday for a holiday. βIt was a very dull day as investors are waiting for directions. But the VAT decision was a bit of a concern for investors,β said Yohan Samarakkody, head of research at SC Securities (Pvt) Ltd.