IFIC calls for end to federal sales tax on mutual funds in RRSPs

The Investment Funds Institute of Canada (IFIC) has recommended that the federal government stop charging GST/HST on mutual funds held in RRSPs.

The recommendation was part of IFIC’s submission to the House of Commons’ consultation for the 2020 federal budget.

While government programs like RRSPs are meant to incentivize Canadians to put away money for retirement, IFIC’s submission said, sales taxes that “continue to be unfairly applied” to investment fund management fees weaken the impact.

Sales taxes account for 11% of mutual fund management expense ratios, the organization said.

“Discontinuing the GST/HST on investment funds held in RRSP accounts is a simple step that would immediately deliver important benefits to millions of modest investors in Canada who are working to save enough for their retirements,” Paul Bourque, president and CEO of IFIC, said in a press release.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.