Chinese Stocks Plummet After Trading Tax Tripled

Move aimed at containing market bubble; could trigger serous sell-off
By Sam Gale Rosen,  Newser Staff
Posted May 30, 2007 8:53 AM CDT
Chinese Stocks Plummet After Trading Tax Tripled
A stock investor reads a local newspaper with headline saying "Stamp tax for security trade has been adjusted to 0.3 percent from today" at a securities' company Wednesday May 30, 2007 in Shanghai, China. Chinese stocks plunged Wednesday after the government raised a tax on trading in an effort to cool...   (Associated Press)

Chinese stocks plummeted today, after the finance ministry tripled a tax on trades in an effort to deflate a worrisome stock market bubble. A week ago, the ministry publicly pledged not to raise the tax. The reversal opens the government to heavy criticism if it triggers a serious rout.

In China, millions have invested their savings in the surging market, which has quadrupled since the start of last year, the Times reports. Yesterday's 6.5% decline was the worst since a February plunge of 8.8% that unsettled investors around the world. The Journal said the move may not be enough to curb the runaway market; the Shanghai index is still 46% above the February plunge.  (Read more China stories.)

We use cookies. By Clicking "OK" or any content on this site, you agree to allow cookies to be placed. Read more in our privacy policy.
Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X