The government is being urged to give the same tax benefits for using investment trusts as enjoyed by unit trusts.
Savers using unit trusts, mutual funds also known as open-ended investment companies (OEICs) do not have to pay stamp duty.
HMRC is currently consulting on whether to ‘modernise’ the stamp taxes on shares, which includes stamp duty and stamp duty reserve tax.
The tax office has asked for opinions from investors and the finance industry on whether to have a single tax on securities rather than the current framework.
Despite this investment trusts have grown in popularity in recent years, helped by the success of Scottish Mortgage Investment Trust PLC (LSE:SMT).
Ahead of the end of the consultation today, Richard Stone, chief executive of the Association of Investment Companies (AIC), said: “We believe stamp duty on investment trust purchases is a long way past its sell-by date.
“It is particularly frustrating that investment trust investors are compelled to pay stamp duty, but buyers of open-ended funds do not pay this tax.
“The abolition of stamp duty for investment trust purchases would help meet the government’s objective of encouraging investment in UK markets and the real economy rather than speculative purchases of cryptocurrency.”
The AIC represents the investment trust industry.