The UK government has planned to scrap the Schedule 19 stamp duty applied to UK-domiciled funds as it will save the asset management industry £145m a year, as announced in the UK budget 2013 yesterday.
The HM Treasury’s budget 2013 policy will save the asset management industry another £145m in tax in the following year before rising to a £150m saving in 2016-17 and £160m in 2017-18.
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Schedule 19 is special stamp duty reserve tax applied to collective investment schemes such as unit trusts or open ended investment companies when investors sell their units and they are re-issued to new investors within a two-week period. The duty gets paid by the fund manager rather than on the investor.
This move aims to stop the UK asset management industry "from losing business to international rivals", it has been announced.
IMA chief executive Daniel Godfrey said: "The abolition of stamp duty on funds in today’s Budget will give savers better returns. The UK is already a world class location for asset management and this is a vital step in allowing the UK to compete as a location for funds."
PricewaterhouseCoopers (PWC) asset management partner, Rob Mellor, said: "This is something that the industry has been requesting for some time.
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By GlobalData"It is great news for the UK asset management industry as it levels the playing field with other European fund locations and should help to encourage more UK and non-UK asset managers to launch UK based fund products."
