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In this weeks Budget, the Chancellor announced a rise in Insurance Premium Tax from 6% to 9.5%, a 58% rise in the tax. The rise will happen in November.
This rise in IPT will add an additional 3.5% to insurance premiums for commercial and individual clients, although IPT on travel insurance, which has been 20% may remain at this level.
Ravenhall Risk Solutions Ltd are members of the British Insurance Brokers Association, BIBA have been working with government to improve the cost of insurance for consumers. BIBA said it was “extremely disappointed” in the decision to increase IPT
Following the announcement by Chancellor George Osborne in the summer Budget for 2015 BIBA’s executive director Graeme Trudgill tweeted: “IPT up to 9.5% from November makes a mockery of the insurance growth action plan and efforts to reduce cost of motor insurance.”
The association described the rise as a “stealth tax”.
Ravenhall are committed to ensuring that our clients get the best value from their insurance spend, but as IPT is not recoverable, unlike VAT for some businesses, the bottom line of this increase will be borne by anyone buying an insurance contract. This is not a benefit to the industry or those within it, with the IPT being paid directly to the treasury.
If you have any questions about this please contact us
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