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Advisers hit out at ‘tax on success’

Advisers have branded the FSA’s move to use firms’ income to calculate regulatory fees a “tax on success”.

Thameside Wealth director Tom Kean says: “There may be a kind of twisted logic in charging firms more who write more business but it seems like a tax on success. The higher producers will shout it is not fair but the lower-producing firms will probably keep their heads down and say nothing.”

Philip J Milton & Company managing director Philip Milton says: “It seems inappropriate and unfair. Why should it be based on revenue? It should be based on the regulatory input involved for that particular firm. Under this scenario, you could have a network that sees its fees fall but the regulatory involvement could be quite significant.”

Evolve Financial Planning director James Norton says: “To some degree, it is reasonable because the larger the level of income potentially the greater the level of risk, but the FSA needs to do something to compensate lower-risk firms. I do not think the FSA wants to necessarily increase the burden on ’good firms’, however, as it stands, the wrong people will end up paying.”

An FSA spokesman says: “Many of our fees are already based on income, which is a better indicator of scale of business and risk than headcount.”


Coventry: Societies’ loan share will fall as banks stabilise

Coventry Building Society says mutuals’ increasing share of the mortgage market is likely to stall as banks’ access to wholesale funding improves. At the end of 2009, building societies’ share of the mortgage market was 12.9 per cent. This rose to 15.1 per cent at the end of 2010 and 16.3 per cent at the […]

SJP reports £800m inflows in Q3

St James’s Place has reported net inflows of £800m during the third quarter of 2011, despite funds under management shrinking by 8 per cent to £26.7bn. In its interim statement for the three months to September 30, the company reported a 14 per cent rise in total single investments from £1.1bn to £1.3 bn. David […]


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