Photo: Collected
The National Board of Revenue (NBR) has extended tax benefits to asset management companies, which operate mutual funds, for another three years.
These institutions have been paying tax at the rate of 15 percent on income earned on mutual fund management fees for a decade.
This facility will be valid till next fiscal year 2026-27. Gazette in this regard has been issued on Thursday.
The gazette states, “By virtue of the powers conferred by sub-section (1) of section 76 of the Income Tax Act, 2023 (Act No. 12 of 2023), the rate of tax arising by asset management companies on mutual fund management fees only has been reduced to 15 The percentage is fixed. This notification will come into effect immediately and will remain in force till the fiscal year 2026-27.”
According to NBR sources, asset management companies are producing world class highly trained fund managers in this country. Besides, it is making a great contribution to the development of the country’s overall stock market by creating the capacity to hire skilled personnel such as investment fund managers, research analysts, valuation experts.
Over the past decade, the asset management sector has seen an increase in the number of highly-skilled workforce fund managers contributing positively to local and international markets.
In view of these considerations, it has been recommended that the tax rate payable by asset management companies on income earned only on account of mutual fund management fees be fixed at 15 percent till FY 2025-26.
Messenger/Disha
