Stock markets respond in a major way to certain Fiscal Policies of government known as lsquo Announc...........

Economic Affairs Tax System

Stock markets respond in a major way to certain Fiscal Policies of government known as ‘Announcement Effect’. Which of the following tax has the most ‘announcement effect’ on stock markets?

Income tax

Property tax

Excise Duties

Capital gains taxation

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Explanation:

Capital gains taxation is the most ‘announcement effect’ on stock markets.

A capital gains tax (CGT) is a tax on capital gains, the profit realized on the sale of a non-inventory asset that was purchased at a cost amount that was lower than the amount realized on the sale. The most common capital gains are realized from the sale of stocks, bonds, precious metals and property.