By JAMES NGUNJIRIMore by this AuthorThe Capital Markets Authority (CMA) is working on a tax framework for securities lending and borrowing that will ensure the product will not distort normal trading at the NSE once it goes live. CMA chief executive Paul Muthaura said Thursday that the CMA is working with The Treasury to ensure that there is tax neutrality for those looking to borrow or lend stocks. This is mainly to those looking to do margin trading or short selling— so that they don’t enjoy a tax advantage over normal board traders. “With regards to a facilitative tax framework, we are in engagement with the National Treasury with a view to ensuring that there is tax neutrality for all SLB transactions in line with international best practice,” said Mr Muthaura. Short selling will only be carried out by regulated persons, as per draft regulations released by the CMA in October 2016.

Source: Daily Nation March 09, 2017 19:05 UTC