Here are the four important Budget 2015 proposals affecting the mutual fund industry.
- An increase in surcharge of 2% from 10% to 12% on additional income-tax payable by companies on distribution of dividends and buyback of shares, or by mutual funds and securitization trusts on distribution of income.
- Tax neutrality on transfer of mutual fund scheme under the process of consolidation of schemes of mutual funds as per SEBI Regulations, 1996.
- Service tax exemption withdrawn on the services provided by mutual fund agents to an asset management company
- Modification in Permanent Establishment (PE) norms to the effect that mere presence of a fund manager in India would not constitute PE of the offshore funds resulting in adverse tax consequences. This would encourage fund managers operating from offshore locations to relocate to India.
