China has further room to cut stamp duty on share trading, China Securities Regulatory Commission Chairman Shang Fulin said yesterday.
"I haven't heard about a further stamp duty cut so far, but there is room for a stamp duty cut when necessary," Shang told reporters yesterday when he attended the annual session of the top legislature.
China cut stamp duty on share trading twice last year to boost the sagging stock market. In April, the regulator lowered the duty to 0.1 percent from 0.3 percent, and it scrapped a tax on share purchases in September.
But an analyst believed a cut is not imminent. "The stamp duty is at an extremely low level, and the regulator wouldn't cut it further in the short term," said Qian Qimin, an analyst at Shenyin and Wanguo Securities Co.
Shang also said the regulator is considering tightening procedures on initial public offerings to ensure they are more market-oriented and also to prevent speculation.
The commission introduced a price-setting mechanism in 2005 to ensure companies which seek domestic listings price new shares through negotiations with at least 20 institutional investors.
Shang added the regulator is preparing for a new Nasdaq-style board for smaller start-up companies as well as the introduction of margin selling and stock index futures. These moves are being made to battle sharply slowing economic growth that may erode corporate earnings and amplify stock-price volatility, making market overhaul a more difficult task, analysts said.
(Shanghai Daily March 6, 2009)
