Finance Minister Maria Kiwanuka Monday adopted and considered a proposal of a 0.5% tax on transfer of shares in an incorporated company listed on the stock exchange. This means that one will now be charged a 0.5% tax on the income from his or her shares after transferring them to another person.
This means that one will now be charged a 0.5% tax on the income from his or her shares after he or she has transferred them to another person.
The 0.5% stamp duty was proposed by Shadow Minister for Finance Geoffrey Ekanya on the floor of Parliament as an amendment to description of instrument 62 (b)under transfers in a bid to enable government balance the 2014/2015 Financial Year Budget.
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Parliament was debating the Stamps Bill, 2013 and the 0.5 tax now stands as an amendment to the bill which was later considered by Parliament and passed with two amendments. Another amendment made by Parliament to the now Stamps Duty Act,2014 was the removal of the instrument by Finance Minister Maria Kiwanuka where the proposed 1% stamp duty on valuation made otherwise than under an order of court.
Minister Kiwanuka noted that these two amendments to the Stamps Duty Act, 2014 will come into effect on Publication of the Act. Other stamp duties provided for under the Act came into effect on 1st July 2014 when the Financial Year started.
Meanwhile, Kiwanuka refused to adopt another tax or stamp duty of 0.5% through the operation of the stock Exchange under description of instruments 18 (c) in the Act. This tax was meant to be imposed on income from shares of companies that go public when selling their shares. However, Kiwanuka said that the tax proposal needs to be studied first by government before it is adopted and that it would be adopted probably in the next financial year.