The mutual fund (MF) industry expects the finance ministry to retain the existing tax benefits available to investors in MF schemes in the forthcoming Union budget.The industry is hoping for the continuation of tax benefits on MFs particularly the exempt-exempt-exempt (EEE) system on tax-saving funds or equity-linked savings schemes (ELSS) of MFs which renders all the investment, interest and maturity tax-free for the investor.
Withdrawal of tax benefits would effect the mutual fund industry adversely as it is already struggling to make its way out from the global economic crisis. Besides, there have been a number of policy changes in the past one year hence, the industry seeks the continuation of tax redemption together with the extension of zero-dividend distribution tax on equity funds to attract investments."We want more clarity on the implementation of the EET system on MFs because a lot of future decisions would depend on it." said Gopal Agarwal, Equity Head of Mirrae Assets.
