The Financial Intermediaries Association of India (FIAI) and the Foundation of Independent Financial Advisor (FIFA) have urged SEBI and the Federation of Indian Chambers of Commerce and Industry (FICCI) to bring uniformity in treatment of GST between AMCs’ management fees and MFDs’ commission.
Currently, investors have to bear the burden of GST on fund management and other fees of AMCs whereas MFDs have to pay GST on commission income, said associations.
In a virtual representation, it said, “Any indirect tax in this case MFD commissions, GST may not be considered as expense and should be allowed to be collected as in case of other services. The anomaly or differential treatment between AMC and MFD commission should be removed.”
The associations further said that the commission payout of MFDs has reduced to 0.66% of assets under advisory from 0.90% due to rationalisation in TER. The impact is much more if GST is factored in, they said.
