Fees for financial planning services should be paid by clients, not by product providers and stamping fees do not promote clients understanding and comparing the fees they are paying, according to the Financial Planning Association (FPA).
In a submission to Treasury, the FPA said it supported the removal of the exemption that allows stamping fees on listed investments and, in doing so, drew parallels with the removal of commission arrangements for financial planners.
“All commissions on investment products have been trending down for FPA members for many years and now account for an average of just 7% of members’ remuneration. This figure will reduce to close to zero with the phasing out of grandfathered commissions by the end of 2020,” it said.
“Stamping fees on listed investment entities make up a tiny proportion of commission revenue for financial planners overall. Removing the exemption for stamping fees would not have major consequences for the vast majority of financial planners,” the submission said.
It said that, as with all changes to allowable revenue, any decision to remove the exemption on stamping fees should be accompanied with appropriate transition timeframes.