Ed Milliband targeting hedge funds may have dire consequences

London

Labour leaders plans to end intermediary tax relief could hurt pension funds and other investors, sources warn.

The Telegraph reports that Ed Miliband’s plans to wage war on hedge funds could be potentially more damaging to the City of London than even the financial transaction tax (FTT), senior banking sources warned on Tuesday night.

The Leader of the Opposition took aim at a number of industries as part of his move to raise more than £2.5bn from the private sector to help fund the National Health Service should Labour be elected at next May’s general election.

Central to that plan – in addition to a mansion tax on homes worth more than £2m and a levy on the profits made by tobacco companies – is a move to raise an estimated £600m from ending a relief which allows hedge funds to avoid paying tax on shares by getting investment banks to buy them on their behalf.

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