| TEL AVIV, April 25
TEL AVIV, April 25 The new head of Israel's
stock exchange called on the government to lower the country's
capital gains tax from the present 25 percent, to encourage more
investment from the public.
"We think 25 percent for private investors is too high,"
Itai Ben-Zeev, the chief executive of the Tel Aviv Stock
Exchange (TASE), told Reuters after a news conference on
"If it goes from 25 to 10 percent, immediately you will see
a shift of people coming to the equity market."
Israel's Finance Ministry said it was studying the issue.
The TASE has seen trading volumes and company listings drop
in recent years. Ben-Zeev partly blamed the capital gains tax,
which he said encouraged the public to invest in other assets
such as real estate, where landlords pay minimal tax on rental
income. Israeli home prices have more than doubled since 2007.
Securities regulator Shmuel Hauser last year blamed some of
the exchange's woes on an anti-business environment in Israel
and hefty regulations the agency is in the process of easing.
"We have had more IPOs in the first quarter than what we had
in the entire previous year and we have a pipeline for more IPOs
and new debt offerings," Ben-Zeev said.
So far in 2017, five initial public offerings have been
made, totalling some $400 million, versus three in all of 2016.
Daily trading volume has risen to 1.6 billion shekels ($439
million) on average, from 1.3 billion daily last year.
"We definitely feel the sentiment has changed," said
Ben-Zeev. "We hear it from underwriters and companies."
In his first news conference since taking office at the
start of 2017, Ben-Zeev outlined a plan to further boost the
market. Among them was a hope for the privatisation of as many
as 15 state-owned companies through the stock exchange with a
combined market value of about 15 billion shekels.
They include two of Israel's ports, the post office, water
company, three defence contractors and electricity utility
Ben-Zeev also wants to bring about 90 Israeli companies that
are traded abroad to list in Tel Aviv as well as hundreds of
small and medium-size firms and high-tech growth companies. He
is also seeking to boost liquidity by enabling banks to become
market makers in stocks, a move that requires approval from the
supervisor of banks.
($1 = 3.6446 shekels)
(Reporting by Steven Scheer, editing by Larry King)