The VAT exemption for the management of special investment funds: a review of their design, impact and alternatives

Currie, David (2023). The VAT exemption for the management of special investment funds: a review of their design, impact and alternatives. University of Birmingham. M.Sc.

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Abstract

The Value Added Tax (“VAT”) treatment of investment management services is one of the most challenging areas for policymakers, tax administrators and taxpayers alike. In both the European Union (“EU”) and the United Kingdom (“UK”), a particular set of investment funds – referred to as Special Investment Funds (“SIFs”) – qualify for VAT exemption on investment management services provided to them whilst other funds – non SIFs – do not. The VAT exemption for the management of SIFs is a mechanism to deliver a particular policy aim of the UK and the EU: to remove the VAT cost on collective investment by retail investors. This dissertation reviews the current definition and VAT treatment of SIFs across the UK and the EU; considers their design, practical and economic impact; analyses the challenges with this definition; and considers alternatives to the current position. I will set out why the best way to fully and properly achieve the UK and EU’s policy aim is to have investment management fees subject to VAT at a zero rate. I will also set out why the definition of a SIF on a principles basis with specific reference to the regulation which governs products intended for retail investors is most appropriate.

Type of Work: Thesis (Masters by Research > M.Sc.)
Award Type: Masters by Research > M.Sc.
Licence: All rights reserved
College/Faculty: Colleges (2008 onwards) > College of Social Sciences
School or Department: Birmingham Business School
Funders: None/not applicable
Subjects: H Social Sciences > HG Finance
URI: http://etheses.bham.ac.uk/id/eprint/13684

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