U.S. mutual fund investors in taxable accounts paid the government $8.6 billion last year, despite poor equity returns and an eight-year low in total distribution payouts, according to Lipper’s recently released 2003 study, Taxes in the Mutual Fund Industry.

In other findings, taxable equity mutual fund shareholders have given up about 1.8 percentage points, while those in fixed income mutual funds have forked over almost 1.5 percentage points in returns over the past 10 years because of taxes. Due to this, shareholders are giving up an average of more than 25% of their returns to government coffers.

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