MF Distributors Have to Bear Tax of 44%

MF Distributors Have to Bear Tax of 44%

Mutual fund (MF) distributors have raised red flag against the government levy of 14% service tax and have made representations with the Ministry of Finance seeking permission to collect the tax either from customers or the asset management companies which receive their services.

Dhruv Mehta, President,
Foundation of Independent Financial Advisors

Mr. Dhruv Mehta, President, Foundation of Independent Financial Advisors, said usually service tax is borne by the recipient of the service and in this case it should be the mutual fund or / the asset management company and can be passed on to the customer, if need be.

“If the distributors have to bear the tax then they would end up paying an unprecedented tax of 44 per cent, including the Income Tax of 30 per cent. This would be unfair, especially when the government is talking of bring down the corporate tax to 25 per cent from 30 per cent over the next four years,” he added.

Currently, of the 1.20 lakh registered distributors, hardly about 40,000 are active.

Foundation of Independent Financial Advisors

Contact Person: Asutosh Routray

Address: 16/A, 16th Floor, Nirmal Bldg, 

Nariman Point, Mumbai - 400 021.

Tel No.: +91 22 49120 200

Email: response@fifaindia.com

Web Site: http://fifaindia.org

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