Wednesday, 23 July 2014
Last updated 29 min ago
Mar 26 2013 | 12:45pm ET
It is unclear whether British Chancellor of the Exchequer George Osborne's plan to cut the price of a pint of beer by a penny will do much to cheer the average recession-weary Briton, but some other aspects of his budget, unveiled last week, will do a great deal to cheer the U.K.'s hedge fund managers.
The proposed budget both cuts the top tax rate and does away with a levy on asset managers. Ending the latter, the stamp duty reserve tax, is estimated to save hedge funds and other money managers a total of £145 million per year.
The stamp duty required asset managers to pay 0.5% when investors sold units in their funds. Osborne said doing away with it would help keep the U.K.'s asset management industry "world-beating."
In addition, Osborne proposed cutting the U.K.'s top tax rate to 45%. Three years ago, the U.K.'s former government boosted the top rate from 40% to 50%, raising fears about an exodus of high-earning hedge fund managers from the country that has mostly failed to materialize.
The Labour Party, who pushed the 50% rate and who are now in opposition, were quick to blast Osborne's budget as a give-away to his rich hedge fund friends. Osborne's Conservative Party has received millions in donations from hedge fund managers, including the money that helped them win the 2010 election.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…