Do not expect a deluge of ETFs domiciled in the UK

“If the stamp duty decision was reversed in the UK, nobody would blink an eye politically.”

The executive added the main tax difficulty centred around passporting funds from the UK to Europe and beyond. He said passporting was commonplace in both Ireland and Luxembourg.

IA welcomes first UK-domiciled ETF

The fund industry trade body, the Investment Association, welcomed the move by Commerzbank and China Construction Bank International to launch the first UK-domiciled ETF.

The trade body’s chief executive Daniel Godfrey said the move showed “with the right tax and regulatory environment, the UK has become an attractive and competitive fund domicile”.

“It also demonstrates that the targeted measures introduced by the government under its investment management strategy, including the abolition of schedule 19 stamp duty reserve tax, are succeeding in attracting investors to UK funds, leading to a chain of wider economic benefits,” he added.