The British Government is to abolish the transaction tax on exchange traded funds (ETFs) in an attempt to lure activity from rival European centres.
Even though Britain is an established hub for fund management, the majority of funds are domiciled in Luxembourg or Ireland for the European region, for tax efficiency reasons.
The Government in Britain announced they intend to complete these plans by April 2014.
ETFs have become increasingly popular, because they provide a cheap alternative to access markets, without directly investing in underlying securities.
The announcement comes after several other announcements introduced by the British government in order to promote the UK as a financial hub, in particular areas of insurance and investment funds.
KPMG remarked that it was great news for the UK investment management industry.
SOURCE: 05/12/13
