Special Purpose Assets Vehicle Law
AFTER more than a year of deliberation, the Special Purpose Assets Vehicle Law is now a reality.
The enactment of the law is expected to generate investors interest in idle bank assets. These assets are currently estimated to be worth 600 billion. Already a number of foreign investments banks have expressed interest in these assets, which will now be put into more productive use, in the process creating a host of other income-earning activities, employment, and growth potentials for the country as well. To facilitate this, the law offers tax perks to investors who buy into banks idle assets, turn around, and resell the assets. The tax perks include exemption from documentary stamp tax, capital gains tax, and valueadded tax.
The law is expected to assist banks unload their non-performing assets and eventually return to profitability. As may be noted, most of the affected banks have many of their resources in non-performing assets. …