UK association urges Chancellor to slow down tax rises
The UK risk management association Airmic has said it is disappointed by the Government’s decision to raise the Insurance Premium Tax (IPT) from 10% to 12% next June, and urged the Chancellor to allow a period of adjustment and stability before considering any further increases.
Julia Graham, deputy CEO of Airmic, said IPT has now doubled in a short space of time which will start to impact businesses. “As with the previous increase, the timing is especially difficult given that many companies will have already set their budgets for the next renewal season.”
She warned that the latest rise in IPT risks insurance becoming a price-driven decision which would be bad for UK business. “Insurance is a strategic purchase and cutting corners in cover to save premium could lead to some customers being disappointed when a claim is made and the cover purchased is not up to the job”.
Airmic believes the higher cost of insurance could also be counter-productive for the Government’s policy of fighting cyber crime. “This increase comes at a time when businesses and the insurance industry are grasping cyber insurance covers more effectively, and it would be disappointing to see businesses deterred from taking on additional relevant covers by this increase. This scenario goes against other Government policies designed to encourage UK businesses to get cyber-fit,” Graham said.