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16 Oct 2018
The Association of British Insurers (ABI) has urged Chancellor Philip Hammond to avoid increasing Insurance Premium Tax (IPT) in the forthcoming Budget.
IPT is a charge on insurance premiums, and affects a range of insurance policies, including motor, business, property and pet insurance, as well as private medical insurance.
The ABI said that IPT has already doubled from 6% to 12% on three previous occasions between November 2015 and June 2017, and stated that 'responsible insurance customers' need not be 'penalised by another tax rise'.
The trade association has subsequently relaunched its '#IPTsUnfair' campaign, which urges the government to think before it implements further IPT rises.
'People buy insurance because it is a legal requirement or because they are wisely protecting their homes, businesses, families and health,' said Huw Evans, Director General of the ABI.
'Punishing these people with another tax rise would be inexcusable.'
Meanwhile, the Federation of Small Businesses (FSB) labelled IPT as 'ridiculous'. Mike Cherry, National Chairman of the FSB, said: 'The IPT deters small firms from making the right choices.
'It's hard for us to persuade small businesses to take on the different kinds of protection they need when they're constantly being hit with increases to this stealth tax.'