The Financial Industry Regulatory Authority has filed an amended rule change with the Securities and Exchange Commission to increase the value limit on gifts by a registered person to $300 from $100 per recipient per year.
The broker-dealer self-regulator said in June that it would raise the limit to $250, but was swayed by industry feedback. FINRA said it "generally agrees with the commenters that a further increase to the gift limit would account for future inflation as well as cost-of-living inequities and differences in purchasing power across parts of the country."
FINRA decided on the bigger boost at its September board meeting.
All commenters supported increasing the gift limit, but some suggested that the gift limit be increased more than $250 to account for future inflation.
One commenter "recommended a $300 limit or alternatively suggested that FINRA embed in the Gifts Rule 'some type of formalized recalculation of the gift limit on some periodic basis (e.g., every 5 years) based on the annual rate of inflation,'” FINRA said.
The Financial Services Institute and Robinhood both suggested a $500 limit, FINRA pointed out.
Robinhood stated that “a higher limit is necessary to take into account future inflation and the likelihood that the new limit will remain in place for many years.”
As described in the proposal, "in determining whether and how much to propose increasing the gift limit, FINRA considered the rate of inflation since 1992, when the gift limit was increased from $50 to $100," the plan states.
"If the same average annual rate of inflation for the past 32 years was maintained and applied to the $100 gift limit, this would result in a dollar value of $294.78 in 2035," the proposal states. "On this basis, a $300 gift limit should account for future inflation for approximately 10 years, thereby reducing the frequency of future upward adjustments to account for inflation."
FINRA said that it intends to review periodically the gift limit to determine if further increases are warranted.
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